New York, New York, July 23, 2013: Carl C. Icahn and his affiliates and Southeastern Asset Management today issued the following letter to the Dell Special Committee.
Ladies and Gentlemen:
In our years in business we have witnessed many unconscionable boards. But, we think that the ongoing “Desperate Dell Debacle” stands out as one of the most startling examples. Amazingly, through it all, the Special Committee continues to remind us just how much they believe that they are taking care of us, watching out for us and protecting us. We have a number of questions for these self-congratulatory champions of Dell stockholders.
WHY FREEZE OUT DELL STOCKHOLDERS?
Why is the Special Committee so committed to forcing loyal Dell stockholders out of Dell so that our company can be sold to Michael Dell/Silver Lake at what we believe is a bargain price?
How long can boards push out and change meeting dates and hide behind the “business judgment rule”?
The answer, my friend, is “Blowin’ in the Wind”.
WILL THE SPECIAL COMMITTEE KEEP ITS PROMISE?
On July 16 the Special Committee told us that it has “taken extraordinary measures to ensure Mr. Dell’s neutrality and to leave the final decision with the disinterested stockholders.”
If you believe the Special Committee did not take "extraordinary measures to ensure Mr. Dell's neutrality and to leave the final decision with the disinterested stockholders" when they postponed last Thursday's vote, then we urge you to vote AGAINST the Michael Dell/Silver Lake transaction. If you believe the Special Committee did not take "extraordinary measures to ensure Mr. Dell's neutrality and to leave the final decision with the disinterested stockholders" when they refused to hold the Annual Meeting on the same date as the Special Meeting, then we urge you to vote AGAINST the Michael Dell/Silver Lake transaction.
The Special Committee asserts that they have taken “extraordinary measures to ensure Mr. Dell’s neutrality”, however:
|1)||When Michael Dell/Silver Lake decided that they wanted to buy Dell, the Special Committee negotiated a Merger Agreement with them to freeze out stockholders.|
|2)||The Special Committee agreed to a Merger Agreement that, in our opinion, through a combination of the restrictive definition of Superior Proposal, a break up fee of up to $450 million, a matching right in favor of Michael Dell/Silver Lake, and other Michael Dell/Silver Lake friendly provisions, acted as an enormous barrier to any potential bidder.|
|3)||In seeking to obtain stockholder votes, Dell has embarked on a pattern of scare tactics, disclosing increasingly negative results and prospects. But we believe that a number of operational decisions at Dell have created much of this bad news. And why does the Dell Board forget to mention the $13 billion spent on enterprise software that is just beginning to show excellent results? In our opinion and the opinion of a number of experts we have spoken to, Dell’s enterprise software and cloud computing have enormous potential. Why can’t all stockholders benefit from this?|
|4)||To top it all off, after promising on July 16 to “leave the final decision with the disinterested stockholders” the Board adjourned the July 18 meeting. Whatever happened to the July 16 promise to “leave the final decision with the disinterested stockholders”? Again we ask why does this Board keeps protecting Michael Dell even after stockholders have spoken?|
WHEN WILL WE HAVE AN ANNUAL MEETING?
WE ALSO CALL ON THE DELL BOARD TO MOVE QUICKLY TO HOLD THE DELL ANNUAL MEETING WHEN STOCKHOLDERS WILL BE ENTITLED TO ELECT OUR SLATE OF DIRECTORS IF THE MICHAEL DELL/SILVER LAKE TRANSACTION IS DEFEATED. Our slate has met and unanimously supports our proposed Dell self tender offer and its implementation in accordance with their fiduciary duties. As previously communicated, we believe that our proposed Dell self tender offer has a total value to tendering stockholders of approximately $15.50 to $18.00 per share.*
VOTE DOWN THE MICHAEL DELL/SILVER LAKE DEAL. VOTE IN OUR SLATE AT THE ANNUAL MEETING WHEN IT IS HELD.
We continue to urge stockholders to vote AGAINST the Michael Dell/Silver Lake transaction. We believe the future for Dell is bright and we hope that you agree.
Carl C. Icahn
O. Mason Hawkins
G. Staley Cates
Icahn Enterprises LP Southeastern Southeastern
Asset Management Asset Management