The Dell bidding war has been going on for quite some time and it is surprising to see that the situation shows no signs of cooling or subsiding as yet. Considered to be the second largest manufacturer of computers, DELL Inc’s Founder and CEO, Michael Dell has been locked in a battle for control of the company since a long time.
Trying to make the company go private, Michael Dell faced opposition in the form of rebelling share holders. Although Michael Dell personally holds over 15% of company stock, stock holders were still allowed and encouraged by the board members of DELL Inc. to place bids which soon started a long, drawn out bidding war. With bids being placed, revised and resubmitted, it comes as no surprise that the bidding war has come to no definite conclusion as yet.
With strong competition in the form of Black Stone Group LP and Cark Icahn already at their throats, Michael Dell and Silver Lake now face another strong opponent who has chosen to dip their feet in the bidding war, namely Southern Asset Management.
Considered to be one of Dell Inc.’s biggest shareholders by owning almost 8.4% of their shares, Southern Asset Management based their decision around the fact that they were not very satisfied with the less than convincing deal that Michael Dell and Silver Lake Partners placed before the shareholders, offering a buyout amounting to $24.4 billion.
However, Southeastern and other shareholders have been rather vocal in their protestations against the company being turned private, claiming that they see no reason why the company needs to be privatized at this stage in its development. Ever since the public announcement made by Michael Dell regarding the privatization of the company, consumers, share holders and board members had been a cause of great hindrance in the plans of Michael Dell.
The current proposal submitted by Michael Dell and Silver Lake Partners did not help soothe the concerns of the company, who were quick to point out that the proxy statement submitted as part of their proposal had only one page detailing Mr. Dell’s plans regarding the company.
On the other hand, Southern Asset Management have found the proposals submitted by opposing contenders, the Blackstone Group LP and Carl Icahn, to be infinitely superior when compared with the proposal submitted by Michael Dell and Silver Lake Partners. Although it is unsure whether Southern Asset Management will decide to take the rein in their hands and jump into the competition, chances are that it is more likely to happen now.
[Image via businessweek]