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Dell Privatization Drama Goes On

The go-shop period on Michael Dell's bid to take Dell private ended quietly on Friday. Turns out the drama wasn't over, and probably won't be for a long time.

This morning, the special committee of Dell's board of directors announced that there are two new offers to compete with Michael Dell's proposal (in partnership with Silver Lake Partners and with Microsoft's backing) to pay $13.65 a share, valuing the company at $24.4 billion.

The Blackstone Group is behind one new proposal that would offer $14.25 a share. Activist investor Carl Icahn, who had already publicly complained about Michael Dell's original offer, is behind the other offer. Icahn's proposal is a complex arrangement involving his current 4.6 percent stake in Dell, equity commitments, an offer of $15 a share up to $2 billion, cash equity financing and other elements.

According to Dell's special committee, either of the proposals could be superior to Michael Dell's offer, but it's too soon to tell. "The Special Committee has not determined that either the Blackstone proposal or the Icahn proposal in fact constitutes a superior proposal under the existing merger agreement and neither is at this stage sufficiently detailed or definitive for such a determination to be appropriate," the committee noted in a statement this morning.

Given the amount of money involved, and the participation of the tactically vocal Carl Icahn, we could be looking at a long period of uncertainty around Dell.

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Posted by Scott Bekker on March 25, 2013 at 11:58 AM


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