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Michael Dell sold shares below offer price to complete buyout deal

Takes personal hit for his company
Fri Feb 15 2013, 12:45

DELL CEO Michael Dell sold his shares in the firm below the price offered to other shareholders in order to push through the leveraged buyout deal to take the company private.

Dell's leveraged buyout was agreed upon last week, with Michael Dell selling his 16 percent stake in the firm to make the deal happen. Now it has been revealed in company regulatory filings that Michael Dell sold his large stake in the firm at a price below the $13.65 offered to other shareholders.

Michael Dell's shares, along with Silver Lake Partners, a Microsoft loan and a handful of banks were central to the leveraged buyout that has angered some Dell investors who believe the deal sold Dell on the cheap. However that Michael Dell sold his stake below the offer price suggests how keen he was to see the deal go through, even if it meant taking a personal financial loss.

In Dell's filing it stated, "To facilitate a price increase by Silver Lake, Mr. Dell and related persons agreed that their shares to be rolled over in the proposed transaction would be valued only at $13.36 per share as opposed to the $13.65 price offered to the company's unaffiliated stockholders."

While Dell has agreed on terms with the various financial institutions and Microsoft, it has also said that shareholders will be able to vote on the buyout later this year. Already two major shareholders, Southwestern Asset Management and T Rowe Price have expressed their disapproval of the deal, suggesting that while the deal will most likely go through it might be a bumpy ride for Michael Dell, his leveraged buyout partners and the banks. µ


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