Carl Ichan proposing that DELL factor its receievable, and on top of that borrow billions of dollars, to raise the cash to pay stockholders a one time dividend? Essentially bankrupt the company to pay him off ?? that idea is absurd.
if Ichan , Southeastern, or any other DELL stockholder thinks DELL is worth more than $13.65 then they need to come up with the money and submit their own buyout proposal. Put up or shut up.
exactly, thats the same thing I was thinking and saying on my post. Why would Dell factor its receivables to pay shareholders? That is crazy. Just load the company up with debt to kill it on a buy out? Icahn must be short Dell's debt.
I think he is about to learn a valuable lesson hear, because Michael Dell and Silver Lake can definitely afford to wait and pay for Dell at a much cheaper price, like in the single digits, lol
The joke is Michael Dell & PE Guys submitting an insufficient bid in the first place; it was DOA on arrival.
Now that DELL is in play, any alternative that releases true value to the shareholder requires evaluation and execution. The Special Committee and full BOD under-performed their fiduciary duty. Ichan is simply outlining areas that should have been pursued by the BOD.
The Dell Board of Director's should have pursued a strategy which would bankrupt the company ?
That is ridiculous.
There is absolutely no justification for borrowing money, factoring out receivables etc..... to raise money for the purpose of paying a dividend. Leveraging a company's assets only makes sense if the
money is used to grow a company's business operations. To fnd its buyout offer, Mike Dell and his buyout team are borrowing to pay shareholders the $13.65 per share. This puts the risk on Mike Dell and his LBO team. If Mike Dell is able to manage the new debt, and transform the company's business lines to becoe growth lines, then certainly Mike dell and his team deserve to profit from thatw ork. but there are absolutely no guaratees that their business plans will produce profitable reults, and at the very least it will take a few years of work.
Icahn's "plan" is for DELL to now borrow money to pay a dividend? That's a joke. If he wants to be taken seriously he needs to come up with the money to make his own buyout offer and then hire people to run the company. same goes for southeastern or any other disgruntled stockholder. it's put or shut up. Right now Mike Dell is the only one making an offer, and it's a generous one at that.
Hope this helps.