Key shareholders of the tracking stock Dell Technologies [NYSE:DVMT] are increasingly hardening against a deal as Dell and its private equity partner have not come to the negotiating table, sources familiar with the matter said.
Activist investor Carl Icahn, who has publicly opposed the deal, told this news service: “Based on our discussion with other stockholders and interested parties, it seems clear to me that the current deal is dead.”
A source familiar with the thinking of another major holder of the tracking stock said that, after speaking to other top twenty holders, the shareholder feels secure that Dell and backer Silver Lake Partners do not currently have enough votes in favor of the deal for it to succeed on its current terms.
Dell has set a shareholder vote on the proposed deal for 11 December. The transaction would see holders of the tracking stock receive 1.3665 shares of newly-issued Dell Class C common stock or USD 109 in cash per share, subject to a USD 9bn cap on the cash component. The transaction effectively takes Dell public and collapses the tracking stock, with holders instead gaining a minority stake in the overall Dell business.
Dell and Silver Lake declined to comment.
by Jonathan Guilford and David Carnevali in New York