More Dell Drama: Report Says Buyout Vote Will Move Again

According to New York Post sources , Michael Dell will accept a proposal by the Dell special committee that would up his buyout offer by a dime to $13.75 a share and postpone the buyout vote for a third time. The move would heap more drama onto the high-stakes poker game between backers of Michael Dell's plan to reinvent the computer maker out of the public eye and activist investor Carl Icahn, who wants to keep the company public.

Icahn, in an open letter to Dell's board Thursday titled "Let The Desperate Dell Debacle Die," said he was pleased the Dell board rejected CEO Dell's attempt to change the shareholder voting rules. Michael Dell didn't want an estimated 27 percent of absentee shareholder votes to be counted as "no" votes.

[Related: 8 Snapshots Of Carl Icahn Takeovers ]

Icahn wrote: "To that proposal, we say: Enough! The stockholders have spoken -- and they do not want to be frozen out by Michael Dell/Silver Lake. Let the vote happen on Friday. Michael Dell has said he is 'at peace either way.' We are glad to hear it! It is time to let the proposed freeze-out merger die."

With less than 24 hours before the scheduled vote there are some glimmers of hope for CEO Dell. According to a Reuters report, some of Dell's undecided shareholders are now leaning toward voting in favor of Dell's $24.4 billion buyout.

Hopes that Michael Dell will prevail hinge on undecided and absentee shareholders to vote in favor of Dell's plan. According to sources close to Dell's special committee, votes that have come in so far are split. For Michael Dell to win, his buyout plan must be approved by a majority of all Dell shareholders.

As part of the Dell special committee's counterproposal to Michael Dell and Silver Lake, the committee offered to change the "record date" from June 3 to Aug. 10. A record date is investor-speak for a date set by a company to determine who its shareholders of record are. In the case of Dell, it would determine what shareholders would have their votes counted and what portion of absentee votes would be considered "no" votes. A change in the record date would delay the Aug. 2 shareholder vote until September, according to sources close to the Dell board contacted by CRN.

If the record date is changed, Icahn is likely to file an injunction to both stop the change in the record date and force Dell to hold the annual meeting and the shareholder vote on the same day. That would also allow Icahn to call for a vote on his $14-a-share recapitalization proposal that includes replacing the Dell board.

According to Delaware law, a company's shareholder meeting should be within 13 months of the previous meeting. Dell's last shareholder meeting was July 13, 2012, making the deadline for its next meeting Aug. 13. Factoring in delays and scheduling, sources close to the board say if Michael Dell accepts its proposal, the vote will likely happen in September.

PUBLISHED AUG. 1, 2013