In order to try and soothe the ruffled feathers of its investors, PC maker Dell has agreed to provide investor information to its largest external shareholder Southeastern Asset Management.
CEO Michael Dell, who holds a 14 percent stake, has led the charge to take Dell private, and keep the company's financial state away from the eyes of Wall Street as well as stripping business strategy control from investing parties. The move to go private has been made in conjunction with private equity firm Silver Lake Management, and although the buyout price of $24.4 billion was made at a share-price premium, many shareholders are less than happy.
According to Bloomberg, the most vocal opposer to the $24.4 billion deal to take Dell private -- Southeastern Asset Management -- will be granted a list of investors pending the signing of a confidentiality agreement.
A filing submitted to the U.S. Securities and Exchange Commission says that the information will be given to the shareholder so it is privy to the same data that Dell considered while in the process of executing the deal -- although the PC maker is not legally obligated to comply with every data request it receives from shareholders. Southeastern will then discuss the terms of the buyout with Dell, acting on behalf of its Longleaf Partners Fund, which is worth $7.7 billion.
Recently, Dell and Icahn Enterprises have also entered a confidentiality agreement to review the company's financials after a plan was pitched to Dell to try and secure a larger payout for grumbling investors.
"What concerns us is the need for each of Dell’s stockholders to make its own independent decisions about its own individual interest, and that is not something that board members can or should be doing for them."
When the deal was announced, Southeastern Asset Management was "disturbed" by the alleged undervaluing of one of the world's largest PC makers, and a letter from the shareholder surfaced, expressing "extreme disappointment" over the buyout price. Shortly after, Dell's second largest investor, T.Rowe Price Group, also voiced its anger over the $13.65-a-share price to be taken private, saying that "the proposed buyout does not reflect the value of Dell and we do not intend to support the offer as put forward."
Voicing complaints are one thing, but some investors have taken a step further. Shareholder Catherine Christner, for example, has filed a suit with Delaware Chancery Court against Dell's management team, accusing executives of "selling Dell on the cheap," to the detriment of investing parties.
For the deal to go ahead, it requires majority approval from shareholders excluding CEO and founder Michael Dell. Currently, the PC maker is within its "go-shop" period, which allows other interested parties to come forward and submit their own bids for the company.
Dell plans to release more information concerning its move to go private by the end of this month.