Blackstone Group has reportedly sent a preliminary counterbid to buy out Dell, which would rival the current proposed offer of $24.4 billion from Silver Lake Partners and Michael Dell made in early February.
Blackstone, an equity firm, submitted its offer to Dell on Friday, the New York Times reported, citing unnamed sources. The offer sets the stage for Dell to hold discussions with Blackstone about a possible buyout, and Dell has until Tuesday to respond to the offer, according to media reports.
Blackstone’s proposed counterbid is in the price range of between $13.65 and $15 per share, according to a report in the Wall Street Journal on Saturday. That either matches or exceeds the $13.65 per share offered by Michael Dell and equity investor Silver Lake to take the company private.
In a letter sent to Dell, Blackstone said it envisioned shedding Dell’s financial services division as part of the buyout deal. Blackstone has already discussed selling that division to GE Financial Services, the Journal reported, again citing anonymous sources.
Dell is expected to soon detail counteroffers to the one made by Michael Dell and Silver Lake, which was announced on 5 February. Dell on March 22 wrapped up a 45-day ‘go-shop’ period in which other parties could make counteroffers.
Dell cannot comment on the reports, a company spokesman said via e-mail on Saturday. Any deal needs to approved by shareholders.
The Blackstone counterbid could set the stage for a long buyout process in which offers are examined and debated. Some of Dell’s major shareholders, including Yacktman Asset Management and Southeastern Asset Management, believe the company is worth more than the $24.4 billion Michael Dell and Silver Lake are offering.
Further counteroffers had been rumoured to be in the works. On Thursday, the Journal reported that Blackstone had approached Southeastern Asset Management and TPG about a possible counterbids.
According to the Journal’s article on Saturday, a possible counteroffer was also in the works by investor Carl Icahn, who is opposed to the current proposed offer and earlier this month reached an agreement with Dell to examine the company’s books.
IDG News Service
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