Tom's Portfolio

Friday, July 5, 2013

icahn and dell join forces

Can Icahn and Dell join force? One of the possible outcomes is, you guess it, icahn and dell join forces. I think the mistake M Dell made for his LBO is to abandon SAM. If he had chosen SAM as his partner, the LBO group owns a little less than 25% and the offer price can be as high as $17. I don't think anyone can stop that deal going through. It is not too late yet. The combined ownership of M, Icahn and SAM is about 29%. If M chose this path, the deal can go through at $15 or higher. And Dell, the company will pay silver lake a small break up fee as this deal is "superior" as defined in the deal agreement. And less debt on dell's balance sheet. The comparison between HPQ and Dell is not that easy as HPQ is debt laden and Dell has net cash on its balance sheet. Why not have a dinner at Texas together, you two?