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Will Michael Dell Become the Ex-CEO of Dell?

By - Source: Toms IT Pro
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Michael Dell is in danger of becoming the ex-CEO of Dell as two new acquisition proposals top the offer that the company’s founder announced last month.

The Special Committee of the Board of Dell received two new acquisition proposals during the “go-shop” period of the merger agreement between Dell and its founder. The new proposals were submitted by the Blackstone Group and Carl Icahn and both seem to be more beneficial to Dell’s shareholders. If either of these offers is selected over Michael Dell’s, the company’s founder might lose his job as the CEO.

The Blackstone proposal is offering shareholders $14.25 a share while Icahn’s proposal listed $15 per share, up to $2 billion of the company’s total. Michael Dell’s proposed buyout, worth $24.4 billion, would offer shareholders only $13.65 a share. Dell’s proposed deal, which was announced last month, received backing from Microsoft, with a $2 billion investment, as well as Silver Lake Management, with an additional $1.4 billion. Michael Dell’s contribution was valued at over $4 billion and includes his current 15% stake in the company. The deal, if approved, would give the company’s founder majority stake in Dell, making the company private.

But Michael Dell’s plan to take control over Dell might backfire as the new acquisition proposals could mean he would not only lose his say in the company but also lose his position as the CEO. According to the Wall Street Journal, Blackstone has already reached out to industry executives about becoming Dell’s next CEO, including “Michael Capellas, a former CEO of PC maker Compaq that is now part of Hewlett-Packard Co.”

The new acquisition proposals are being reviewed by Dell’s board alongside Michael Dell’s original offer to determine which bid is more advantageous to shareholders. The company’s founder will have an opportunity to adjust his bid if either of the two proposals is selected by the board.

Kasia LorencKasia LorencKasia Lorenc is a contributor to Tom's IT Pro. Combining her love of IT and marketing, she currently serves as the Director of Technology and Search Marketing for Zacuto USA in Chicago.

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