Stockholders Agree to Privatize Dell through a $24.9 Billion Buyout Transaction

Stockholders Agree to Privatize Dell through a $24.9 Billion BuyoutShareholders in Dell Inc have finally spoken. They have given their collective approval to the $24.9 billion buyout offer to make the company private. The approved bid was lodged by Dell founder Michael Dell, who is backed by private equity partner Silver Lake Partners.

The approved deal would translate to a payout to shareholders of $13.88 for each of their shares. The transaction is set to be completed by the third quarter of the company’s 2014 fiscal year. The approval came from stockholders with majority of shares, excluding Mr. Dell and those in the Board of Directors, the management, and related family trusts. This is in accordance to the Delaware law.

Pleased by the vote

As expected, Mr. Dell said he was pleased with the outcome of the shareholders’ vote. He assured that he would continue to make Dell as among the leading providers of reliable technology solutions. He added that as a private company with support from a reliable private-equity partner, the company could continue to serve its customers and at the same time further drive innovations to achieve goals.

The company’s Special Committee, which was formed to ensure the best process to bring about ideal outcome to Dell shareholders, was also glad about the results of the vote. In a statement, the committee said the approval of the buyout offer could be the best option that would possibly maximize share value.

Disgruntled other bidder

The privatization of Dell was initially proposed in February. But it was pushed back when businessman Carl Icahn lodged his own bid backed by private equity partner Southeastern. For some time, Mr. Icahn seemed determined to snap Dell from its shareholders.

But he decided to pull out his bid last week. In a letter addressed to Dell stockholders, he accused Mr. Dell of employing ‘dirty tactics’ to make sure his bid would gain enough votes. Mr. Icahn said he had realized that it would be impossible for his offer to win the approval.

Mr. Icahn now seems to be focusing his attention on Apple Inc. According to reports, he started buying more shares in the company on Wednesday (September 11), when prices fell after investors felt disappointed that Apple’s iPhone 5C is not as affordable as it was expected. Mr. Icahn obviously took advantage of the 5.4% drop in Apple’s share prices to increase his shares in the iPhone and iPad maker.

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About the author

Kristin covers health, science and internet news.