Dell Buyout Hits a Roadblock

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By Douglas A. McIntyre Updated Published
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In an exclusive report, Reuters revealed that the largest single independent shareholder of Dell Inc. (NASDAQ: DELL), Southeastern Asset Management, has voiced objections to the price of the leveraged buyout. Because of the size of the money management fund’s holdings, and the likelihood it will vote against the transaction, other institutional shareholders might join the fight, and throw the Dell buyout into disarray.

Reuters reports:

Southeastern has privately told the company that it is “disturbed” by a $13.65 per share offer for the third-largest PC maker by a consortium led by founder and CEO Michael Dell, and instead believes Dell is worth $20 per share, the sources said on Thursday.

The Memphis, Tennessee-based fund, which owns a 7.5 percent stake in Dell, did not return calls seeking comment.

Southeastern has not commented publicly since the deal was announced on Tuesday, but Chief Executive Mason Hawkins said in a September 30 filing that the fund believed the company’s shares were worth in the “low 20s” even if Dell’s personal computing business was valued at nothing.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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