Dell committee rejects Icahn bid and warns of $2.9bn black hole

CARL Icahn’s efforts to take control of PC maker Dell have once again been rejected by a bid committee, despite him claiming to offer greater shareholder value than founder Michael Dell’s $24.4bn (£15.8bn) offer.

An independent group set up to ensure that investors gain maximum value from a takeover said yesterday that Icahn’s offer had “a $2.9bn funding shortfall”.

It said that if Icahn and bid partner Southeastern Asset Management won support for their takeover bid, shareholders could lose out massively, despite the offer being valued at $14 per share against Michael Dell’s $13.65.

Rather than offering cash for shares, Icahn is proposing a complicated system that involves paying a special dividend to shareholders using a combination of loans and Dell’s own cash, and then buying the shares at a knockdown price.

The committee’s rejection of Icahn’s offer is the latest blow to the 77-year-old’s attempt to take control. His previous proposal was also rejected after it was seen as having significant funding gaps.

Dell’s shareholders will vote on whether to accept Michael Dell’s offer on 18 July.