(Reuters) Activist investor Carl Icahn has built a stake that was likely around 100 million shares in Dell Inc and wants the personal computer maker to conduct a leveraged recapitalization, complicating founder Michael Dell’s effort to take the company private, CNBC reported.
Icahn, who is known for shaking up management, has accumulated a stake in Dell representing 6 percent of the company, CNBC said on Wednesday, citing sources familiar with the investment.
The network reported that Icahn wanted Dell to take on debt of as much as $9 billion (5.98 billion pounds) and pay out a special dividend to shareholders.
Shares of Dell were up nearly 2 percent to $14.35.
The investor was not immediately available for comment.
Icahn’s arrival on the scene typically puts companies – and their boards – on guard, because the outspoken activist investor has a reputation for aggressively demanding changes by building up stakes in target corporations.
A special committee of Dell’s board of directors said earlier on Wednesday the pending sale of the PC maker was the best alternative for shareholders, despite opposition from its largest outside shareholder.
The committee, which had been analyzing Dell’s situation for more than five months, said in a statement on Wednesday that it had “negotiated aggressively” to ensure shareholders got the best possible value in agreeing to founder Michael Dell’s $13.65 per share offer to take the company private.
Other alternatives the special committee said it looked at besides a sale included a leveraged recapitalization, changing the dividend policy, selling parts of the business and working with the company’s current business plan.
The committee said that investment bank Evercore is still soliciting potential alternative proposals in a process that ends March 22.
Michael Dell said in February he had struck a deal to take Dell private, partnering with private equity firm Silver Lake and Microsoft Corp. The goal is to facilitate Dell’s difficult transition from a commodity maker of computers into a provider of services to enterprises as a private company, away from Wall Street’s scrutiny.
But since the deal was announced, a number of investors have said the price was too low.
On Tuesday, Dell’s largest external shareholder, Southeastern Asset Management, demanded that Dell open its books, signalling it could become more active in opposing the offer.
Shareholders representing almost 14 percent of Dell shares, led by Southeastern with a stake of more than 8 percent, including options, have said they will vote against the proposed buyout. The third largest shareholder, T. Rowe Price, has also spoken out against the deal.
(Reporting By Poornima Gupta and Liana B. Baker; Editing by Gerald E. McCormick, Grant McCool and Carol Bishopric)