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Wednesday, February 6, 2013

Dell investor sues to block founder's leveraged buyout, (NASDAQ: DELL)

Michael Dell's offer to take Dell Inc private for $24.4 billion should be blocked because the leveraged takeover is unfair to the struggling computer company's stockholders, according to a lawsuit by an individual investor that was filed on Wednesday. The buyout announced on Tuesday at $13.65 per share substantially undervalued the company's long-term prospects, according to the lawsuit, which seeks class action status to represent all Dell investors.Michael Dell, founder of the company conceived in a college dorm room, teamed up to make the offer along with the Silver Lake private equity firm and Microsoft Corp, whose operating system is used in Dell computers. They hope to revive the struggling company away from the scrutiny of public markets.Some shareholders said they were angered by the lack of specifics about the deal, making it hard for them to determine if the price was fair. The company, which failed to comment on the lawsuit, had said the board had conducted an extensive review of its strategic options before agreeing to the buyout.The deal was priced at a premium of about 25 percent above where the share price stood before news of the buyout talks leaked in January. The complaint by shareholder Catherine Christner said the deal was priced 22 percent below Dell's stock price a year ago.

Dell, Inc. (Dell) is a global information technology company that offers its customers a range of solutions and services delivered directly by Dell and through other distribution channels. Shares of DELL traded higher by 0.75% or $0.1/share to $13.52. In the past year, the shares have traded as low as $8.69 and as high as $18.36. On average, 36091200 shares of DELL exchange hands on a given day and today's volume is recorded at 77649040.