Activist investor Carl Icahn today issued an open letter to his fellow Dell (DELL +0.00%) shareholders, rescinding his offer to purchase the computer supplier.
According to Icahn, several factors influenced the decision, including a raise in Michael Dell's bid to buy the company, as well as the company's change in the rules for voting on Michael Dell's offer. Icahn said he still intends to oppose Michael Dell's proposal, and will continue in an effort to appraise the company's value.
Michael Dell's $24.8 billion bid to take his company private includes an offer of $13.75 per share plus a $0.13 dividend. Icahn has said the buyout would keep stockholders from sharing gains the company will reap from an eventual turnaround.
Icahn, working with Southeastern Asset Management, has been the most vocal opponent of Michael Dell's intentions to take the company private, and has proposed several potential alternatives over the past few months -- including purchasing almost two-thirds of outstanding Dell stock at $14 per share.
Despite his efforts, Dell's board has remained steadily in support of the deal Michael Dell has proposed with Silver Lake Partners to take the company private. Shareholders are scheduled to vote on the issue Sept. 12.
"I realize that some stockholders will be disappointed that we do not fight on," Icahn wrote. "Michael Dell/Silver Lake waged a hard fought battle and... the actions by Dell were within the Delaware law. We therefore congratulate Michael Dell and I intend to call him to wish him good luck (he may need it)."
Dell's shares have plunged by more than 40% since Michael Dell returned for a second stint as CEO in 2007, largely because the company has had trouble adapting to a technological shift that has caused PC sales to fall as more people use smartphones and tablets.
-- Material from The Associated Press was used in this report.
