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Carl C. Icahn and Southeastern Asset Management Issue Open Letter to Dell Stockholders and Special Committee
Posted by: Grass Hopper (IP Logged)
Date: July 31, 2013 05:08PM


New York, New York, July 31, 2013 – Carl C. Icahn and his affiliates and Southeastern Asset Management today issued the following open letter to stockholders of Dell (DELL) Inc. and the Dell Special Committee.

Dear Fellow Dell Stockholders and Dell Special Committee:

Today we read that the Dell Special Committee will not accept Michael Dell/Silver Lake’s request to amend the stockholder approval requirement previously agreed to by Dell, Michael Dell and Silver Lake. We are pleased to see that the Special Committee heeded our advice.

But now, the Special Committee has proposed to change the record date for the special meeting of stockholders, which would further delay the stockholder vote that was first scheduled for July 18. To that proposal, we say: Enough! The stockholders have spoken – and they do not want to be frozen out by Michael Dell/Silver Lake. Let the vote happen on Friday. Michael Dell has said he is “at peace either way”. We are glad to hear it! It is time to let the proposed freeze-out merger die.

If the Special Committee fails to heed our advice to hold the Special Meeting on Friday and let the stockholders finally vote after six months of uncertainty, and instead, they decide to reset the record date and schedule the Special Meeting for the fourth time, it is imperative, AS WE HAVE REQUESTED FOR MONTHS, that Dell also hold the Annual Meeting on that same day and at the same time.


The Dell Board needs to immediately set a record date for the Annual Meeting and announce the date for the Annual Meeting. The current Dell directors have been sitting for over a year. We believe that the Dell Board has a fiduciary obligation to ensure stockholders have the opportunity to make their choice:

Do stockholders want to continue with the incumbent directors who have supported what we believe is an undervalued merger with the company’s founder, largest stockholder and CEO?


Do stockholders want to elect our director nominees who, if elected, will promptly move forward, subject to their fiduciary duties, with a Dell self-tender offer at $14 per share plus warrants and allow stockholders to remain in the company to enjoy the benefits of what we believe will be a resurgent Dell under new management?

By negotiating an undervalued freeze-out merger, pushing relentlessly to have it approved by even going so far as to try to waive one of the most important stockholder protections in the Merger Agreement, and holding an interview with The Wall Street Journal where he espouses his concern for employees and customers, but barely mentions and certainly shows no concern for, his stockholders, Michael Dell has revealed all we need to know. And to be honest, we fear to what end he will go to keep Dell under his control if and when his freeze-out merger is finally allowed to be rejected. Specifically, will he try to purchase additional stock to further increase his 15% position in the company in an attempt to ensure he keeps control of the company at the Annual Meeting? The Dell Board must consider this question seriously and should prevent Michael Dell from buying votes by buying shares. What we view as the ill-effects of Michael Dell’s influence have been broadly felt. Since Michael Dell returned as CEO, the stock has dropped from $24.22, to this morning’s price of $12.46. The freeze-out merger was his idea all along and it has been shown to be an unpopular one. The Board should not aid him by permitting him to increase his influence at Dell.

Again, to be very clear: Take the vote on Friday. Be “at peace” with the outcome. Immediately set the record date for the Annual Meeting and give stockholders the choice they deserve after all these months of uncertainty.


Carl C. Icahn

Icahn Enterprises L.P.

O. Mason Hawkins, CFA

Southeastern Asset Management, Inc.

G. Staley Cates, CFA

Southeastern Asset Management, Inc.

Guru Discussed: Carl Icahn: Current Portfolio, Stock Picks
Stocks Discussed: DELL,
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