Dell Board Committee Insists Sale Was Best Outcome

Dell Board Committee Insists Sale Was Best Outcome

The special committee of Dell’s board that supervised the company’s $ 24.4 billion sale to its founder reiterated on Wednesday that the deal was the best option for shareholders.

The committee said it bargained hard before the current offer to take it private was finalized.

“We negotiated aggressively to ensure that stockholders received the best possible value,” it said.

The statement comes after weeks of bickering between Dell and some of its shareholders, including its two biggest outside investors, over the $ 13.65-a-share bid from the company’s founder and chief executive, Michael S. Dell, and the investment firm Silver Lake Partners.

Southeastern Asset Management and T. Rowe Price, who together hold about 13 percent of Dell, have said they will not support the current offer.

Southeastern, an asset management firm with an activist streak, has hired advisers to advance its cause, and it demanded a list of Dell’s shareholders on Tuesday. The firm has said it values Dell at over $ 20 a share, and people briefed on the matter said it would prefer to see the deal die rather than let the current sale go forward.

For much of the last month, shares in Dell have traded above the offer price, suggesting investors are anticipating an improved offer from its founder. So far, Mr. Dell and Silver Lake have resisted improving their bid. Shares closed on Tuesday at $ 14.07.

In its letter to Dell’s directors on Tuesday, Southeastern wrote that the board “appears to have dismissed better alternatives for public owners and selected a transaction, which has been publicly derided by shareholders as opportunistic and grossly undervalued, that favors management.”

But the special committee said in its statement on Wednesday that it had considered all possible alternatives, including continuing Dell’s current business strategy; borrowing money and then paying out a special dividend; and selling all or part of the company.

The group, led by Alex J. Mandl, handled the sale negotiations, which were directed on the buyers’ side by Egon Durban, an executive at Silver Lake.

The committee also said it had requested a number of provisions designed to help any competing bidders make a higher offer, including a contract with the investment bank Evercore Partners that rewards the firm for finding a better offer.

Evercore has until March 22 to find a superior bid, though people briefed on the matter have said they do not expect any to arise.


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