Northern, WI 02/07/2013 (wallstreetpr) – CEO Michael Dell with other directors of Dell Inc. (NASDAQ:DELL), US based technology company was sued by an investor with the evidence that the Board of directors are replacing shareholders in an MBO (management buyout) scheme of $ 24 billion.
With more than 15 % shareholding in the computer & technological sector, CEO has misused his top position for inducing directors, chairmen & top executives to corner ordinary shareholders by leading the MBO, the plaint of investor Catherine Christener read. The lawsuit was filed in the Delaware court, yesterday.
The grounds of the complaint include the performance negligence by the directors in performance of their fiduciary resulting in the transfer of the company`s ownership for a very low consideration.
Facts & figures showed that Mike Dell & his private equity company, Silver lake management LLC, will pay a $14 per share for takeover, a 25 % above the exchange traded proof of $11 as on Jan 11th, before the news of it going private, spread all over the market. Officials said with the purpose of acquisition of majority shareholding, Dell orchestrated such MBO.
David Frink, a spokesman for Round Rock-Texas based Dell Inc. (NASDAQ:DELL) declined in response to Christina`s legal suit against the company.
Stock Prices of the company plunged to more than 50 % since 2007 beginning, when Mike Dell took over once again as a CEO, as a result of repeated management failure in the midst of harsh competition from mobile & cloud computing start-ups.
Competition while maintain a profitability for over last 25 years, Dell Inc. (NASDAQ:DELL) is now moving towards private. Internal restructuring is also being performed in the form of reduction in head count for& rescheduling of work enhance performance benefit of big customers with an aim to enhance performance of the data center.
Dell Inc. (NASDAQ:DELL) share price, which handles two market leading company, Hewlett Packard Co. & Lenovo Group ltd., goes to $ 13.52 making a 10 cents increment in NASDAQ exchange yesterday. With the continuous fight & penetration in adaption of acknowledging new area of smart phones & tablets, its stock gives it a comfort with 31 % increase last year.
Proceeding further with management buyout, Dell & silver lake officials declared Nov 5 as deadline for finishing its buyout scheme, in US SEC application.
Explaining the suit by Christener’s lawyer referred to share price movements on the stock exchange during the preceding year.He contend that MBO is fixed at a price some 22 % below its Feb 8, 2012 price of $18. In short, they are taking huge advantage from this buyout which is unethical.
Going with what the investor`s attorney says, it is revealed that Dell which is concentrating on developing all-inclusive IT solutions rather continue as against its existing computer manufacturing operations. With the news of the buyout spreading since last week share prices have plunged leading to a cleared way for acquisition at a dwarfed price.
Its Board of directors not able to achieve & cope with its long term goals & plans, thus, failed to satisfy Shareholders.
The shares of Dell Inc. (NASDAQ:DELL) were decreased by 0.41% and currently trading at $13.46.