Arik Hesseldahl

Recent Posts by Arik Hesseldahl

Dell’s Shareholder Meeting and Vote on the Leveraged Buyout

dell_brainstormThe meeting of Dell shareholders for a vote on the $24.4 billion leveraged buyout proposed by Michael Dell and the private equity firm Silver Lake is set to begin shortly.

One of three things will happen: The vote will pass with a majority of at least 43 percent of shareholders not named Michael Dell voting in favor of the deal; it will fail with a similarly sized majority voting to reject it; or the meeting will be called to order and then immediately adjourned, effectively delaying the vote for as much as a week. If a vote happens at all, it is expected to be close.

Each of those eventualities brings with it a set additional outcomes. If the proposal is approved, Carl Icahn is expected to lead an effort among shareholders to fight the deal through the courts. If it fails, it sets up the prospect of a protracted proxy battle for control of the company. If it is delayed, it means Michael Dell and Silver Lake have decided to try and lobby a few more shareholders to switch sides. Pressure will be on them — and, for that matter, on Icahn, too — to raise their bid.

5:55 am: Good morning. We’re waiting for the meeting to get under way.

6:01 am: So this is being billed as a “special meeting of the shareholders.” It will be led by Alex Mandl, the Dell director who has headed up its special committee.

6:03 am: Okay, we have music.

6:05 am: “Today is the day we waited for.” ELO, a.k.a. Electric Light Orchestra. Nice choice.

6:06 am: We’ll see about that. If the vote is delayed via an adjournment, today may not turn out to be the day.

6:07 am: We’ve just gotten the five-minute warning. “Please take your seats.”

6:10 am: And now silence. I imagine a lot of people milling about.

6:12 am: I have been told by sources familiar with how things are expected to go that the meeting will be very short.

6:13 am: So, what we’re expecting is one of three scenarios: The buyout proposal will be approved quickly. This is, I think, unlikely, given the number of shareholders who have come out against the deal in recent days.

The meeting is beginning. Alex Mandl is speaking. He’s talking about the corporate bylaws.

6:15 am: He is moving for an adjourment. Meeting is adjourned until next Wednesday.

6:16 am: So, after all that, no vote will occur today.

6:17 am: Mandl said the purpose of the adjournment is to “solicit further shareholder votes.”

6:18 am: This means that the next meeting will be convened on July 24 at 8 am CT, at Dell’s Campus in Round Rock, Texas. That means we’ll see you here next week.

6:19 am: With that, we’ll close out this liveblog.

Thanks for tuning in, and we’ll see you back here next Wednesday.

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