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Icahn Moves to Plan C

He wants a Delaware Chancery judge to appraise the value of the company if shareholders accept the buyout offer next Thursday

After three shareholder advisors backed Dell's privatization plan, Carl Icahn, the billionaire activist shareholder who's trying to squeeze more money out of his recently acquired ~9% position in the company, now second only to Michael Dell's 16% holding, posted an open letter to Dell stockholders Wednesday saying they should join him in going to court to force Michael Dell to pay more than the $13.65 a share on offer.

He wants a Delaware Chancery judge to appraise the value of the company if shareholders accept the buyout offer next Thursday.

Of course shareholders would have to vote against the deal to seek an appraisal, which - if enough of them did - could derail the $24.4 billion offer precipitating a potentially nasty fight for control of the company and slamming Dell shares down to around $8 or less.

On the other hand, the judge could take years to decide and still find the shares are worth less than $13.65 a pop.

The Wall Street Journal says "owning appraisal rights could potentially be an issue for some institutional shareholders who have strict rules about holding only public shares."

Icahn has the notion that he could negotiate a better price from Michael Dell and Silver Lake Partners by offering to drop the appraisal scheme within the 60-day grace period that goes with it in return for a sweetener for the naysayers.

Dell said last week that $13.65 is as good as it's going to get.

Around 42% of Dell outstanding stock has to support the buyout for it to succeed.

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Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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