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Dell Special Committee Urges Stockholders To Reject Icahn's Proposal

A Special Committee of the Board of Dell Inc. (DELL: Quote) Tuesday recommended its shareholders to reject Carl Icahn's proposal for a $15.6 billion self-tender by the company at $14 per share.

"Based on analyses prepared by our advisors and our own view of the business, we do not believe that Icahn's proposal is superior to the certainty of value offered by a sale of the entire Company at $13.65 per share, " said the committee.

The committee believes that it is unwise to layer substantial financial risk on a company already facing significant challenges from competition and from the rapid pace of technological change.

As a private company controlled by Dell and Silver Lake, the company will have a significant debt burden, the risks of that capital structure will be borne entirely by the buyers and not by the public stockholders.

According to the committee, Icahn's proposal does not provide the basis for it to change its recommendation. The Board could independently resolve to consummate various leveraged recapitalization transactions.

The company also warned its shareholders of Icahn's campaign to discredit the Special Committee and accuse it of frightening Dell stockholders, and has urged the stockholders to base their decision on the facts without being misled by Icahn's self-serving accusations.

by RTT Staff Writer

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