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March 26, 2013

More Dell Drama: Before Opposing, Southeastern Considered Joining Buyout

By Nicole Spector, Contributing Writer

Well, it's sticking to its current story, but it could be that Southeastern Asset Management, who now opposes Dell's (News - Alert) leveraged buyout, was originally keen on getting in on the action. The news comes from two people who are merely identified as “familiar with the matter.”



The sources reveal that on January 29, a week before Michael Dell and the private equity firm Silver Lake Partners announced their $22.4 billion buyout bid, Southeastern parlayed with one of Dells' independent directors, Alex Mandl – a figure in the committee reviewing the company's choices.

At the time of the meeting, Southeastern, which owns 8.5 percent of Dell, supposedly announced itself as a party interested in joining the leveraged buyout and retaining a stake in the technology mega company. Southeastern reps rejected a buyout between $14 and $15 a share. The company, which makes PCs and offers business software and technology services, has since openly declared that Dell is worth $24 pop a share.

Neither Dell nor Southeastern commented on the gossip, but a person “close” to Southeastern, insists that what went on behind closed doors is exactly what went on in public, implying there has been no change in Southeastern's stance throughout. The company has a major investment in Dell, and stands to lose around $400 million at Dell's current buyout price of $13.65 per share.

Patting Southeastern on its back for its opposition – consistent or not – of the Dell buyout, is Alpine Capital Research. The firm's managers have stated that they would vote their two-million shares against the buyout. 




Edited by Brooke Neuman
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