Published On: Tue, Oct 16th, 2018

WWII: Carl Icahn Declares War on Michael Dell’s Planned Return to Public Markets

Michael Dell & Carl Icahn
Billionaire activist investor Carl Icahn comes out against Michael Dell and the private equity firm Silver Lake $21.7 billion VMware buyout offer.

Icahn now VMware’s second-largest shareholder, said Monday that he has upped his stake in the tracking stock to more than 8% – or over $2 billion. But Dell is “manipulating” shareholders of VMware into accepting his buyout offer.

In a scathing letter, Ichan bashing the proposed buyout by Dell that could make the computer giant publicly traded once again.

Icahn claimed Dell and Silver Lake are using “scare tactics,”. They “literally stealing” $11 billion from shareholders in a plan to take the computer giant publicly traded once again.

In an interview on CNBC’s “Halftime Report.” he said: “You’ve got two guys that are going to make $11 billion. Eleven billion dollars for doing nothing. It’s unrivaled even on Wall Street’s standards.”

In the letter published online Monday Icahn said: “While we have unearthed many undervalued opportunities in the past, very few companies compare to the current opportunity and the massive undervaluation of DVMT – which exists in plain sight for all to see.”

Icahn said in a letter included in a securities filing that the deal in its current form values the company at closer to $94. But the value of VMware should be $144.

Ichan’s calculations show VMware could generate in free cash flow over “a few years,” a value of more than $250 a share.

“VMware holders shouldn’t agree to the deal unless it contains a very, very substantial increase,” Icahn said. “I intend to do everything in my power to STOP this proposed DVMT merger. In my opinion, it is better to have peace than war. I still enjoy a good fight for the right reasons, and in the current situation, I do not see peace arriving quickly!”

Ichan added: “Clearly Michael Dell and Silver Lake take us for fools if they think that we would exchange this future value potential for only $94 per share. I intend to do everything in my power to STOP this proposed DVMT merger.”

 

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