Carl Icahn Commences Litigation Against Dell Technologies

(Bloomberg) -- Billionaire activist investor Carl Icahn sued Dell Technologies Inc., claiming the company has refused to provide basic information about its proposed plan to return to public markets by buying up shares of DVMT.

• Complaint filed Wednesday in Delaware Chancery court seeks judge’s order requiring Dell to allow Icahn to inspect and copy its books and records.
• Icahn also wants judge to establish process for considering which documents can be made public.
• The “transaction is the result of a very transparent and thorough process including an independent special committee representing DVMT shareholders, which was supported by its own financial and legal advisers,” Dell responded in an emailed statement.
• Dell responded in court denying Icahn’s allegations and accusing him of using the litigation as a “rhetorical platform” in its proxy battle, according to a copy of its filing.

Key Takeaways

• Icahn alleges in complaint that Dell is using threat of forced conversion of stock to coerce investors into approving transaction at Dec. 11 shareholder meeting.
• Icahn said in statement Thursday that Dell refused to provide information related to period from July 3 to now, while advisers have been soliciting votes.
• Investor called DVMT deal a “conflicted transaction” that benefits controlling shareholders at the expense of DVMT holders.
• Affiliates of Icahn own about 9.2 percent of Dell’s Class V shares, according to complaint.
• Hearing on Icahn’s request to expedite case set for 3 p.m. Monday.
• Dell said in its filing that there is “no true emergency justifying such expedited proceedings.”

Background

• Icahn came out against Dell’s plan to return to public markets last month, arguing the proposed transaction undervalues the DVMT shares.
• Billionaire will solicit votes against the deal and may propose an alternative deal to give investors a chance to cash out.

--With assistance from Jef Feeley.

To contact the reporter on this story: Scott Deveau in New York at sdeveau2@bloomberg.net

To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Michael Hytha, Matthew Monks

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