M & A Law Prof Blog

Editor: Brian JM Quinn
Boston College Law School

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Monday, July 15, 2013

Dell responds to Icahn warrant offer

Here is the Dell Special Committee's official response to Icahn warrant offer from last week:

“We are today reviewing the fifth proposal from Carl Icahn, which would include issuance of warrants in connection with the self-tender proposal he previously outlined. We are working with our advisors to evaluate whatever benefits might flow to shareholders from the warrant he has proposed to include in his structure. We would note that a portion of any value attributed to the warrants would be offset by a reduction in the value of the recipients’ stub equity, as well as the fact that receipt of the warrant would likely be a taxable event. We have been and remain willing to meet or talk with Mr. Icahn about his various proposals, including at a meeting scheduled earlier this week which he requested and subsequently cancelled.

“More broadly, it is important to note that all of Mr. Icahn’s various proposals require abandoning an all cash transaction at a substantial premium with a high degree of closing certainty that shifts all of the risks of the business to the buying group in exchange for a highly speculative recapitalization concept that relies upon the future value of a leveraged public technology company. We have studied variations on this theme for months and continue to have substantial reservations about that value proposition.

“Most important, we believe it is critical that Dell shareholders not be distracted from the clear choice they must make next week – take $13.65 per share in cash or bear the risks of continuing to hold their Dell shares.”

Shorter version:  We are thinking about it because our fiduciary obligations require us to, but there is nothing really here of any interest to us. Move along. 

-bjmq

http://lawprofessors.typepad.com/mergers/2013/07/dell-responds-to-icahn-warrant-offer.html

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