Michael Dell will have to beat off Carl Icahn and private equity firm Blackstone if he is to regain ownership of the company that bears his name. And the duo of new bidders have indicated they may unite in their attempt to seize control of the vendor.
The Texan PC maker confirmed yesterday that the 45-day "go-shop" period kicked off by the agreement of the Dell/Silver Lake deal has elicited two further bids.
The Blackstone bid – which would allow shareholders to receive either cash or stock – values Dell at $14.25 (£9.40) a share, above the $13.65 offered by Michael Dell and Silver Lake. Dell would remain listed on the NASDAQ if the proposed deal goes through. The leveraged recapitalisation deal will be funded by a mixture of equity and debt financing, as well as company cash and cash equivalents.
"We are committed to continuing to pursue a transaction on the terms herein, which we believe will provide a more compelling value proposition to Dell and its shareholders than currently provided under the [existing] merger agreement," says the Blackstone proposal.
Icahn's offer – for just under three fifths of the company – will include a $1bn investment from Icahn Enterprises and a further $1bn from Icahn himself. The deal will also lean on $7.4bn of cash already available at Dell, $5.2bn in new debt and a $1.7bn-worth in new factoring receivable facilities. Shareholders will be allowed to maintain their current holdings or cash in their chips for $15 a share.
Icahn, who already personally holds a $1bn stake in Dell, has indicated today that he is open to the idea of teaming up with his rival bidder.
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