Original URL: http://www.theregister.co.uk/2013/07/25/dell_vote_delay_again/

Dell buy-out latest: Big Mike makes shareholders an offer they can't refuse

Bonus 10c per share offered if auto-vote rules rewritten

By Brid-Aine Parnell

Posted in Business, 25th July 2013 12:31 GMT

Dell has once more put off the vote on whether company founder Big Mike can buy out the PC-making titan - after he and his biz partner Silver Lake Partners slightly upped their offer to shareholders and demanded a change to the voting rules.

The computer giant's special board committee postponed the stockholder vote on Mikey Dell's offer to 2 August; Mike and Silver Lake had increased their offer by 10c a share to $13.75, providing the board was willing to completely change the rules to help his plan go through.

At the moment, stockholders who abstain have their votes counted as a no, but Mike wants to only count the ballots that are actually turned in, significantly lowering the threshold for his plan to go through.

Big Mike said his offer to shareholders was his "best and final offer" and he wasn't willing to follow through on it if the special committee didn't go along with the rule change.

According to Mr Dell and Silver Lake, people holding 27 per cent of the company's shares hadn't yet voted, which would all count against the tech tycoon's master plan.

"The presumption that these shares should be treated as if they had voted against the transaction is patently unfair," they said in a statement.

"The will of the majority of the unaffiliated shares voting on the transaction should not be thwarted by an unfair standard that counts unaffiliated shares not voting as “no” votes. We believe that the vote of the majority of the unaffiliated shares voting on the transaction should be respected, and that if this majority wishes to accept our offer, it is only fair to permit them to do so."

Activist investor and rival bidder for the IT giant Carl Icahn naturally reacted with outrage, having already claimed the process was unfairly weighted towards Michael Dell.

"In a Merger Agreement with widely-criticised protective devices in favour of Michael Dell/Silver Lake and a sales process that included a number of advantages for Michael Dell/Silver Lake, the one stockholder protection was the requirement that a majority of the non-Michael Dell shares approve the deal," he and his partner Southeastern Asset Management said in a statement.

"The Special Committee has now been asked to GUT this provision to effectively render it meaningless. And, in return, Michael Dell/Silver Lake have offered to increase the deal price by $0.10, or 0.73 per cent!"

They claimed that commentators had compared the Dell situation to North Korea and once again called on the firm to schedule its annual meeting so that the board could be replaced.

"It is time for Michael Dell and this Board to go. After more than a year since the last annual election, it is time to schedule the 2013 Annual Meeting and move forward," Icahn and Southeastern said.

The special committee said it would review the new offer and its conditions, and rescheduled the vote to 2 August. ®