The Bidding War for Dell Has Officially Begun

Never mind that Dell buyout deal proposed by founder and CEO Michael Dell in early February: activist investor and professional company-shaker-upper Carl Icahn has put a better offer on the table in a letter released by the PC manufacturer today. Icahn, unhappy with the share price Dell offered, is offering to pay $15 per share, almost 10 percent better than the $13.65 price Dell and Silver Lake Partners proposed. Icahn's deal would price the company at $15.5 billion, according to Deal Journal's David Benoit. Icahn is not alone, however: investment firm Blackstone has also a made its own, separate proposal for $14.25 per share. Since Dell himself has a lot to lose in a buyout—starting with control of his own company, as The Wall Street Journal 's Shira Ovide explained yesterday—the Icahn and Blackstone proposals could trigger a bidding war. Dell may make a better offer, Ovide suggests, "But if Blackstone, Mr. Icahn or others unseat the Silver Lake deal, Mr. Dell may wind up on the sidelines without a say in the company. That might put the onus on Mr. Dell and Silver Lake to up their bid," she writes.

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Dell has not commented on the new bids yet, but Bloomberg's Aaron Ricadela has sources saying that he is willing to work with third parties to sweeten his offer. One analyst still thinks the most likely scenario keeps Dell in control of the company with help from Siver Lake "for something north of what they’re currently offering."

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All of the offers have to get approval from the shareholders before proceeding. At this point, the committee considering the proposals still hasn't decided if these two offers are "superior" because neither is "sufficiently detailed" or "definitive" writes WSJ's Tess Stynes. Also, all three of the proposals offer to purchase a different amount of the company. (Benoit has a nice breakdown of those confusing scenarios.)