BOSTON May 15 Several top stock-picking hedge
funds bought about 30 million shares of PC maker Dell Inc
in the first quarter, possibly increasing pressure on
company founder Michael Dell to improve his bid to take the
Dell is embroiled in a leveraged buyout deal proposed in
February at $13.65 a share by its founder and private equity
firm Silver Lake Partners. But the price has upset some of the
company's largest shareholders.
Boston-based Highfields Capital, run by former Harvard
endowment manager Jonathon Jacobson, bought 23 million shares of
Dell in the first quarter, according to a securities filing on
Wednesday. The activist hedge fund often presses for
improvements from companies in which it invests.
Jeffrey Altman's Owl Creek Asset Management bought 4
million shares, and Farallon Capital Management, led by Andrew
Spokes, took a new 2.46 million-share position in the first
Investors must vote a majority of Dell shares, excluding the
16 percent controlled by Michael Dell, in favor of the buyout
for the deal to go through. The 30 million-share purchases,
worth over $400 million at Wednesday's closing price, represent
about 2 percent of Dell's shares outstanding, according to
Thomson Reuters data.
The securities filings by the three hedge funds on Wednesday
represented their holdings as of March 31. The funds could have
added or reduced to their Dell stakes over the past 45 days.
Previous Dell shareholders, including T. Rowe Price Group
and Southeastern Asset Management, opposed the buyout at the
current offer price. Southeastern and billionaire investor Carl
Icahn last week proposed that Dell pay a special dividend of $12
per share and remain a public company.
On Monday, a special committee of Dell directors said it
needed more detailed information from Icahn about financing and
future plans for the company before it could seriously consider
his proposal. Under Icahn's plan, shareholders could choose to
take the special dividend in cash or stock, costing the company
as much as $21 billion.
Shares of Dell closed at $13.45 on the Nasdaq on Wednesday.
The shares have traded below the $13.65 offer for the past four
weeks after another possible bidder, Blackstone Group,