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Carl Icahn Gets Another Week To Screw Around With Dell

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You have to be a little nuts to go to a shareholder meeting, though I suppose when the meeting is to vote on a hotly contested proposal to merge the company out of existence you might have business reasons for doing so. So if you're a merger-arb analyst following Dell closely, I hope you didn't fly to Austin last night! If on the other hand you're just, like, a general retired crackpot, I'd love to hear what your plans are for the next week:

Dell Inc. announced that today’s Special Meeting of Stockholders was convened and adjourned to provide additional time to solicit proxies from Dell stockholders. No vote was taken on the proposed transaction prior to the adjournment.

The Special Meeting will reconvene on July 24, 2013 at 5:00 p.m. Central Daylight Time at the Dell Round Rock campus, Building No. 2, Houston-Dallas conference room, 501 Dell Way, Round Rock, Texas 78682. The record date for stockholders entitled to vote at the Special Meeting remains June 3, 2013.

I hope someone will make a touching romantic comedy about two Dell shareholders stuck in Round Rock for a week waiting for the meeting to re-convene. In the meantime we have what I submit to you is the greatest liveblog in the history of that genre:

5:55 am: Good morning. We’re waiting for the meeting to get under way.
6:01 am: So this is being billed as a “special meeting of the shareholders.” It will be led by Alex Mandl, the Dell director who has headed up its special committee.
6:03 am: Okay, we have music.
6:05 am: “Today is the day we waited for.” ELO, a.k.a. Electric Light Orchestra. Nice choice.
6:06 am: We’ll see about that. If the vote is delayed via an adjournment, today may not turn out to be the day.
6:07 am: We’ve just gotten the five-minute warning. “Please take your seats.”
6:10 am: And now silence. I imagine a lot of people milling about.1
6:12 am: I have been told by sources familiar with how things are expected to go that the meeting will be very short.
6:13 am: So, what we’re expecting is one of three scenarios: The buyout proposal will be approved quickly. This is, I think, unlikely, given the number of shareholders who have come out against the deal in recent days.
The meeting is beginning. Alex Mandl is speaking. He’s talking about the corporate bylaws.
6:15 am: He is moving for an adjourment. Meeting is adjourned until next Wednesday.

Hoo boy. Imagine how exciting the real meeting will be! Very not exciting, is the answer.

So does this mean the buyout is getting voted down? No oneseems to think so, particularly, and the stock was actually up today, which is presumably not because shareholders are excited about the prospect of getting some Icahn warrants. DealBook counted some noses:

But a number of big institutional investors switched their votes to “yes” overnight, said a person briefed on the matter, signaling hope that the leveraged buyout was still viable.

That group – including the Vanguard Group, BlackRock and the State Street Corporation – had previously indicated opposition to the deal.

The moves indicate the kind of gamesmanship that has surrounded the transaction in recent days. Advisers to the transaction believe that many investors were simply bluffing to try obtain a higher offer from the buyout team of Michael S. Dell and the investment firm Silver Lake.

A large group of investors, which included the three big money managers as well as Invesco and the Bank of New York Mellon, switched their vote to “yes” sometime around midnight, the person briefed on the matter said.

Umm so if they switched their votes to yes at midnight, and the deal didn't have enough votes at 6am, that seems like a bad sign, no? Apparently some noses remain to be counted, though:

As of Thursday, about 77% of the shares eligible to count were voted in the deal, according to people familiar with the matter. (That figure doesn't include shares controlled by Mr. Dell.)

You will not be surprised to learn that Carl Icahn is disappointed, or says he is, anyway, obviously Carl you love it. You also won't be surprised to learn that he wants Dell to hold its annual meeting as soon as possible, so he can win his proxy fight, get his directors elected, and launch his tender offer.

In some ways, if you're Dell, don't you want that too? Not the Icahn-winning part, but give him his shot and let him lose? There seems to be a pretty high likelihood that Dell currently lacks a majority for both the Michael Dell buyout and Icahn's board slate and convoluted tender-offer-with-warrants. Some people want the buyout, some people want Icahn, some would take either one, and some people want to be left alone with a public company. If you could have an up-or-down vote on the Icahn option, and get pro-buyout crowd2 and the left-alone crowd to vote against Icahn, then that could be a way to get rid of the Icahn option. Given a clean choice of $13.65 vs. the public company, it might be easier for shareholders to pick the $13.65. They should adjourn the special meeting for a month and do the annual meeting next week.3

But of course you could never get rid of Icahn entirely. Losing a proxy fight would only make him angry, and an angry Carl Icahn - like every other variety of Carl Icahn for that matter - would lob in ever-changing proposals with ever-increasing glee. And, meanwhile, Dell's merger agreement with Silver Lake has a November drop-dead date. And you have to imagine that Silver Lake is getting increasingly sick of this whole thing.

Dell Special Meeting of Stockholders Adjourned Until July 24 [EDGAR]
Carl C. Icahn and Southeastern Asset Management Issue Open Letter to Stockholders of Dell and Special Committee [EDGAR]
Dell’s Shareholder Meeting and Vote on the Leveraged Buyout [AllThingsD]

1.I hope not, right?

2.Including the quarter-billion shares owned by Michael Dell and his directors and officers, which are not eligible to vote for the merger but can vote against Icahn all day long.

3.Oh, notice requirements, it'd need to be much more drawn out than that, but you know what I mean.