Dell Sweetens Tracking-Stock Deal After Facing Shareholder Pressure
15 Noviembre 2018 - 11:41AM
Noticias Dow Jones
By Micah Maidenberg
Dell Technologies Inc. confirmed it is raising its offer to buy
out an affiliate, a move that comes after the company faced
pressure from large investors to sweeten the bid.
The PC maker and data-storage company said Thursday its new
offer for owners of DVMT, which tracks the value of Dell's stake in
software maker VMware Inc., implies a value of about $24 billion.
The offer includes up to $14 billion in cash, with the remainder
coming in a swap for new shares. The purchase of the tracking stock
would help return Dell to public markets after it was taken private
in 2013.
Dell's prior offer implied a value of almost $22 billion,
including $9 billion in cash. Putting more cash on the table will
increase the certainty of value for shareholders in DVMT, Dell said
in a statement.
In 2015, Dell set up the tracking to help it finance its
takeover of data-storage company EMC Corp., the company that owned,
at that time, the majority of VMware. Tracking stocks allow
companies to expose specific business units to public markets,
potentially increasing their visibility and value.
The Round Rock, a Texas-based company, expects the current
owners of DVMT to own between 17% to 33% of the new publicly traded
Dell, depending on cash and stock elections.
The Wall Street Journal reported Wednesday that Dell planned to
increase its offer.
Some large investors were considering voting against the
company's initial offer at a special vote scheduled for Dec.
11.
Dell said the new proposal has support from key owners of the
tracking stock including Dodge & Cox, Elliott Management,
Canyon Partners and Mason Capital Management. Together, those
shareholders own 17% of DVMT.
BlackRock Inc., which owns a more than 4% stake in DVMT, is also
supportive, according to people familiar with the matter.
A representative of activist investor Carl Icahn, who owns a
9.3% stake in DVMT, didn't respond to a request for comment about
the new offer. On Wednesday, Mr. Icahn said that future owners of
the publicly traded Dell should have the right to elect at least
three independent directors to the company's board.
Dell also agreed to allow owners of the future publicly traded
Dell shares to elect an independent member to the company's
board.
Shares in DVMT rose 0.3% to $106.03 in Thursday trading.
Cara Lombardo contributed to this article.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
November 15, 2018 12:26 ET (17:26 GMT)
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