Yacktman Asset Management backs Mr. Icahn, holding Dell Inc. (NASDAQ:DELL) is undervalued.
Shares of Dell Inc. (NASDAQ:DELL) plunged 0.56% to close at $13.36 In its last trading session. However, shares remained to be at the higher end of its 52-week price range of $8.69 to $14.64. This was in the backdrop of lines starting being drawn over the future of the buyout deal of Dell. As ISS took sides with Michael Dell, Asset Management major Donald Yacktman sided with Carl Icahn, the person who has ever since being trying to make the buyout proposal of Mr. Dell a flop.
Reuters reported that Yacktman Asset Management, which owns around 15 million shares of Dell Inc, has extended its support to Mr. Icahn, believing that Mr. Dell is undervaluing the company. He even went to the extent of suggesting a change in company’s board which might improve the fortunes of company, maybe even enhance its shareholder value.
For Mr. Icahn’s side of the proposal of $14 per share to be accepted, above from Mr. Dell’s offer of $13.65 per share, shareholders will not only have to reject the proposal made by Mr. Dell, but also elect the full team of directors by Mr. Icahn to the board, to even put his proposal before the company. This seems to be too much to ask, which thereby jeopardizes the chances of Mr. Icahn’s proposal sailing through.
This move by ISS is viewed as a game turner and is expected to take a toll on the decision of shareholders to now vote in favor of Mr. Icahn. Now Dell Inc.’s special committee is planning to meet major shareholders in its last efforts to lure them to their side, arguing that stocks could fall to as low as $5.85 in adversaries.
Also, Mr. Dell has to his side not only the mandate of ISS, but also other leading proxy advisory firm Glass Lewis and Egan-Jones, upholding its proposal of $13.65 per share.