Dell Completes Buy-out, Lists Shares On NYSE

Dell Technologies shares have started trading again, after a five year hiatus when the company went private. The shares started trading on 28 December on the New York Stock Exchange (NYSE) after the company completed its Class V transaction, receiving shareholder approval, as expected, on 11 December at a special meeting. Dell said it paid USD 14 billion in cash and issued over 149 million shares of its Class C shares in connection with the transaction. To relist its shares, Dell, staged a USD 24 billion cash-and-equity deal, buying stock back from shareholders. The shares closed on their first day at USD 45.413 per unit, giving the company a market capitalisation of close to USD 35 billion, the Wall Street Journal reported. Dell said 91.2 percent of the shares outstanding elected to receive cash, with the remaining shares choosing stock in the newly public company.

Dell won shareholder approval for the DVMT deal earlier this month after resistance from a group led by activist investor Carl Icahn. The opposition led the company to increase its offer and restructure the deal. As part of the agreement, Dell said shareholders could also elect an independent board member. Under the new terms, holders of Dell Class V tracking stock could opt to receive USD 120 per share in cash or between 1.5043 and 1.8130 shares of Class C common stock in Dell, up from USD 109 per share or 1.3665 shares in the previous offer.

Dell said elected in the aggregate to receive about USD 21.8 billion in cash, which exceeded the USD 14 billion cap on the total cash consideration. This means the cash consideration will be subject to a proration factor of approximately 0.6414 ($14 billion cap on the aggregate cash consideration divided by approximately $21.8 billion of cash elected). Each Class V stockholder that opted to get cash for Class V shares is entitled will get (prorated) cash for the units, and get Class C shares for its remaining Class V common stock, together with cash in lieu of any fractional shares of Class C common stock.

With the completion of the Class V transaction, Dell Technologies has about almost 172 million outstanding Class C shares and around over 718 total shares.

Founder Michael Dell and private-equity firm Silver Lake took Dell private in 2013 in leveraged buyout worth around USD 25 billion. Silver Lake invested a total of USD 2.4 billion into Dell, according to people familiar with the deal. That stake became worth over USD 6 billion on 28 December.  – Telecompaper