The latest proposal from Icahn maintains his offer of US$14 a share for up to 71% of Dell stock, but adds one warrant for every four Dell shares, entitling the holder to one share of Dell at US$20.
A statement by Icahn and Southeastern Asset Management, which also opposes the private equity plan led by company founder Michael Dell, said the new offer is worth between US$15.50 and US$18 a share, compared with US$13.65 offered in the buyout plan.
The move comes less than a week ahead of a shareholder vote on the private equity plan led by Michael Dell with financing from Silver Lake Partners.
The buyout got a major boost on Monday (15 July) when the prominent proxy advisory firm Institutional Shareholder Services recommended that Dell shareholders vote for the transaction.
ISS said the buyout could lead to a "truncation of value" of Dell but noted that rejection of the plan might mean "meaningful loss of value."
The proxy advisory firm said the offer was 25.5% above the value before news of the deal circulated and "transfers the risk of the deteriorating PC business and the company's ongoing business transformation to the buyout group."
The special committee set up by Dell to evaluate options for the company has warned of "substantial downside risk" if shareholders reject Michael Dell's plan.
Dell unveiled plans to go private in February, giving Michael Dell a chance to reshape the personal computer company without the spotlight of Wall Street.
The move, which would delist Dell from stock markets, could ease some pressure on the company, which is cash-rich but has seen profits slump, as it tries to reduce its dependence on personal computers.
Source: AFP via I-Net Bridge
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