Blackstone, Icahn mull Dell bids


Mon, Mar 25, 2013 - Page 15

Investment fund Blackstone Group sent a letter to Dell Inc on Friday indicating that it was finalizing a counteroffer to buy it out, a source said on Saturday.

Billionaire Carl Icahn also notified the computer firm he was working on a bid, the Wall Street Journal reported on its Web site, citing people familiar with the matter.

Last month, Dell unveiled plans to go private in a US$24.4 billion deal. The private equity buyout led by founder Michael Dell, backed by equity investment firm Silver Lake, would give shareholders US$13.65 per share.

The company had set a Friday deadline for alternative offers.

According to the Wall Street Journal, the Blackstone letter does not detail a bid, but “offers a range that is higher than the existing [US]$13.65 per share offer but lower than [US]$15 per share.”

The newspaper, citing unnamed sources, also reported the letter said Blackstone envisions potentially selling Dell’s financial-services business to help fund the deal.

GE Capital is seen as a “likely buyer,” it added.

Spokespeople for Dell and Blackstone declined comment. An Icahn spokesman could not be reached.

The Dell-led buyout plan would include a US$2 billion loan from Microsoft Corp.

The move would de-list the company from stock markets and could ease some pressure on Dell, which is cash-rich, but has seen profits slump as it tries to reduce dependence on the shrinking PC market.

Icahn and other investors have criticized the US$13.65 a share offer from the Michael Dell group as being too low. Several buyout scenarios tying Blackstone to Dell have been leaked to the media.

Dell shares closed on Friday at US$14.14, a sign that investors expected to see a higher bid. Some analysts have forecast Dell will be sold for US$15 to US$16 per share.

Southeastern Asset Management, Dell’s second-largest shareholder, has said the company is worth closer to US$24 per share.