New York (HedgeCo.Net) – Activist hedge fund investor Carl Icahn and partner Jefferies & Co., have secured $5.2 billion in financing for their bid for a leveraged recapitalization of Dell, according to Reuters.
“With that we put an end to the unwarranted speculation by Dell that our money would not be available,” Icahn said in a letter to other shareholders. He is currently the second-largest Dell shareholder.
Reuters says: “Obtaining the debt financing marks a critical step forward for Icahn’s and Southeastern Asset Management’s alternative offer for the company. Icahn and Southeastern are proposing that Dell buy back 1.1 billion shares at $14 apiece. The tender offer compares with founder Michael Dell’s and Silver Lake Partners’ $24.4 billion buyout at $13.65 a share, a price Icahn said substantially undervalues the company.”
Ichan secured the $5.2 billion in loans from several banks and institutional investors, according to reports, it includes a 6-year loan worth $2.2 billion, as well as a 3.5-year loan for $3 billion. The sum is part of a much broader plan on Icahn’s part to essentially take control over the company and provide an alternative to Michael Dell’s buyout deal that would take his company private.
Alex Akesson
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