updated 10:24 pm EDT, Thu July 11, 2013
New offer to shareholders allows warrant stock purchases at $20
Further complicating the Dell buyout, investor Carl Icahn is claiming that he will increase his bid for the company on Friday. Icahn said that he will make the new offer, allowing shareholders to purchase additional shares of the company at a future date at a price of $20, regardless of the company's share value at purchase time.
"We think our bid is superior, but we're going to add to it," declared Icahn in his interview with Bloomberg TV. The interview was Icahn's second salvo against Dell in one day, with the investor having sent an open letter to shareholders earlier in the day, reminding them that they can take their rights under Delaware law to ask a judge to determine the value of the company if they oppose a deal, such as the one for $13.65 per share offered by Michael Dell and his cadre of investors.
Following Icahn's $14 per share offer, Michael Dell called his offer sufficient, and refused to raise it, despite pressure to do so by advisory firms. The existing privatization deal put on the table by Michael Dell requires the majority of the shareholders (not including Dell's own shares) to vote in favor of the payout. Southeastern Asset Management, another vocal opponent of the Michael Dell buyout, would lose at least $825 million if the privatization deal completes. Dell has dramatically cut its forecasts for 2013 operating profit by $700 million, to an estimated $3 billion -- casting further shadows over any deal.