Carl Icahn Pens Letter Bowing Out of Dell Deal
Billionaire activist investor Carl Icahn penned an open letter on Monday to Dell Inc. shareholders announcing the end of his battle with the company’s Board of Directors. Some reports indicate Icahn will leave the deal about $11 million richer and will refocus efforts on Apple.
In the letter, Icahn accused Michael Dell—who can now regain control of the company—and Silver Lake Management of undervaluing Dell Inc.: “because: 1. Dell is paying a price approximately 70% below its ten-year high of $42.38; and 2. The bid freezes stockholders out of any possibility of realizing Dell’s great potential.”
Dell is so far silent on Icahn’s withdrawal but this frees up the anticipated Thursday vote on taking the company private. Michael Dell and Silver Lake’s offer is $24.9 billion. This is the fourth attempt at a vote, which has been repeatedly postponed. Michael Dell and Silver Lake raised their offer in August by $0.10 a share to $13.75 to entice investors. They further agreed to pay a special $0.13-per-share dividend by the deal’s closing date, assuming it succeeds. That is on top of the stock’s regular $0.08 dividend.
Language in the letter compares the Dell board to a dictatorship, invokes Clark Gable’s infamous, “I don’t give a damn,” in reference to the Board and makes veiled accusations of stretching Delaware law.
Icahn ended the letter by promoting his Twitter feed, “If you are incensed by the actions of the Dell Board as much as I am, I hope you will choose to follow me on Twitter where from time to time I give my investment insights.”
Icahn is apparently enamored of his Twitter account. His profile blurb lists him as: “Chairman of Icahn Enterprises L.P.; etc., etc. Some people get rich studying artificial intelligence. Me, I make money studying natural stupidity.”
[Images via Carl Icahn Twitter and Dell Official Website.]
Twitter is great. I like it almost as much as I like Dell.
— Carl Icahn (@Carl_C_Icahn) June 20, 2013