Billionaire investor Icahn names alternative Dell board, overshadowing a key product launch

Billionaire investor Carl Icahn has named his alternative board for struggling computer giant Dell in a bid to scuttle a proposed private equity deal led by Silver Lake Capital and company founder Michael Dell.

If accepted, Icahn will also appoint a new board of directors to oversee the company, which will not include founder Michael Dell.

Yesterday, Dell presented Icahn and Southeastern Asset Management president Staley Cates with a formal request for information covering key aspects of the takeover bid.

In the letter, the special committee overseeing the takeover talks includes requests for the full terms and structure of Icahn’s proposed deal, comprehensive information regarding its financing, arrangements to provide working capital or other liquidity following the closing and the new board Icahn plans to appoint.

According to Reuters, Icahn revealed his alternative board includes himself; Bernard Lanigan Jr, chief executive of Southeast Asset Advisors; Rahul Merchant, New York City’s chief information officer; and Jonathan Christodoro, managing director at Icahn Capital.

As SmartCompany reported late last week, Icahn, together with Southeastern Asset Management, has proposed a counter-offer to the Silver Lake/Michael Dell private equity takeover bid for the computer giant.

Under Icahn’s leveraged recapitalisation plan, shareholders in Dell would receive a once-off dividend of $US12 per share, with the company borrowing to fund the $US21 billion payment.

Unlike the Dell and Silver Lake deal, under Icahn’s recapitalisation offer, existing shareholders will retain any stock they hold in the company.

However, the ongoing takeover saga is threatening to overshadow new product launches at the PC giant, with the letter coming on the same day the company launched a new tool called the Online Solutions Configurator, aimed at the company’s enterprise partners.

“The new Solution Configurator for Partners is based on their direct feedback and provides an efficient, collaborative sales tool to make it easier to configure Dell’s enterprise solutions,” says Dell’s executive director for global channel marketing and programs, Kathy Schneider.

In late January, SmartCompany reported Microsoft and founder Michael Dell joined a bid by private equity firm Silver Lake Capital to take the company private, with a $US24.4 billion deal struck in early February.

In a previous offer, Icahn had offered shareholders $US15 per share for a 58% stake in the company.

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