A group of key shareholders stand a fighting chance of derailing Michael Dell’s ambitions to take the company he founded private.
The possibility of a privately held Dell has sparked our imagination, and also left us scratching our heads. As one of the leading PC OEM’s of our generation Dell has had a profound impact on personal computing, however, they also have a long history of failure that shouldn’t be forgotten. The big question facing Dell shareholders today is what the company’s long term prospects are, and if a $24.4 billion buyout offer by Michael Dell and his consortium is in their best interest.
The New York Times and Reuters have confirmed that at least four of Dell’s top 20 shareholders think the company is worth more than they are being offered, and together they stand a fighting chance of derailing Michael Dell’s ambitions to re-take the company.
The shareholder group led by Southeastern controls over 10% of the firm’s total equity, and has promised to hit the company with litigation, proxy fights, and “available Delaware statutory appraisal rights” to try and kill the deal. The Michael Dell led consortium has already confirmed they don’t intend to raise the current offer, so what we have here is an old fashioned stock market standoff.
The best Michael Dell can hope for at this point is that Southeastern will back down, or that their cry to action will be heard by investors so drunk on the post PC revolution Kool-Aid that they will dump Dell shares at any cost.