Largest Independent Dell (DELL) Holder Says $20 Should be Minimum 'Go Private' Price
Dell, Inc. (Nasdaq: DELL) shares are coming under some pressure Friday following reports that its largest independent shareholder, Southeastern Asset Management (SAM), is poo-pooing the proposed $13.65 'go private' bid.
Announced earlier this week, SAM thinks the $24.4 billion buyout of Dell "undervalues" the company. SAM, which holds a 7.5 percent stake in the PC giant, believes that Dell is worth at least $20 per share, noted Reuters.
Though SAM hasn't made an official announcement on the matter, a September 2012 filing shows that CEO Mason Hawkins thinks Dell is work something in the "low $20s," even if its PC business were valued at zero.
The buying group, which includes CEO and founder Michael Dell, private equity firm Silver Lake Partners, and Microsoft (Nasdaq: MSFT), have no plans to raise the current bid and hope that investors will come to realize that no better option exists for Dell at this stage.
One analyst from Bernstein estimates that SAM gathered its stake at about $20 per share, meaning a potential loss of $825 million if the buyout proceeds at $13.65 per share.
Earlier in the week, shareholder Pzena also said that $20 should be the floor on talks. Pzena holds a 14.4 million stake, equivalent to about 0.8 percent of all outstanding shares. Other holders have also voiced displeasure over the bid, though only a smattering have publicly decried the offer.
Into the open, Dell is down about 0.2 percent.
Announced earlier this week, SAM thinks the $24.4 billion buyout of Dell "undervalues" the company. SAM, which holds a 7.5 percent stake in the PC giant, believes that Dell is worth at least $20 per share, noted Reuters.
Though SAM hasn't made an official announcement on the matter, a September 2012 filing shows that CEO Mason Hawkins thinks Dell is work something in the "low $20s," even if its PC business were valued at zero.
The buying group, which includes CEO and founder Michael Dell, private equity firm Silver Lake Partners, and Microsoft (Nasdaq: MSFT), have no plans to raise the current bid and hope that investors will come to realize that no better option exists for Dell at this stage.
One analyst from Bernstein estimates that SAM gathered its stake at about $20 per share, meaning a potential loss of $825 million if the buyout proceeds at $13.65 per share.
Earlier in the week, shareholder Pzena also said that $20 should be the floor on talks. Pzena holds a 14.4 million stake, equivalent to about 0.8 percent of all outstanding shares. Other holders have also voiced displeasure over the bid, though only a smattering have publicly decried the offer.
Into the open, Dell is down about 0.2 percent.