Dell raises offer but wants vote changes

Dell founder Michael Dell has raised his $24.4bn bid by $150m but the sweetened offer is contingent on a key change to the shareholder voting rules that will make it easier for him to take the world’s third largest computer maker private.

The sweetened $13.75 per share bid by Michael Dell and private equity firm Silver Lake came hours before a rescheduled vote on the buyout proposal, which has drawn strong opposition from major investors including billionaire Carl Icahn and Southeastern Asset Management.

The new proposal from the founder and his backers hinges on Dell’s special board committee changing the rules of the voting such that the buyout will pass if the majority of votes cast by shareholders is in favour of it. Currently, the voting rules state that a share not cast in the election counts as a “no” vote, which has proven to be tough to overcome.

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Dell’s special committee said it was evaluating the new proposal.

The committee is seeking at least $14 per share from the buyout group in order to consider a potential change in the voting terms, a person familiar with the matter said.

Shares of Dell were flat at around $12.88 early on Wednesday.

“According to our latest tally, approximately 27 percent of the unaffiliated shares have not yet been voted. The presumption that these shares should be treated as if they had voted against the transaction is patently unfair,” Michael Dell and Silver Lake said.

The votes that have come in so far are believed to be evenly split between yes and no.