Southeastern Asset Management wants the market to know that, when it comes to fighting Dell‘s proposed $24.4 billion sale, it means business.
The mutual fund manager disclosed in a regulatory filing on Tuesday that it has retained D. F. King, a big proxy solicitation firm, as an adviser. It also confirmed that it holds about 8.4 percent of Dell’s shares, making it the biggest investor apart from the company’s founder, Michael S. Dell.
Proxy solicitors like D. F. King are important parts of fights over shareholder votes. They canvass a company’s investor base, providing their clients with estimates of how shareholders are leaning and strategies for winning over allies.
The fund manager has also hired Dennis J. Block of Greenberg Traurig, a longtime mergers and acquisitions lawyer, according to a person briefed on the matter.
Southeastern has publicly condemned Mr. Dell’s $13.65-a-share bid to take the computer maker private, calling the offer significantly undervalued. In a press release on Friday, the asset management firm said that it plans to consider all of its options to fight the deal, including a proxy fight, a lawsuit and calling upon a Delaware court to determine the fair value of Dell shares.
Likely driving the firm’s opposition is the high price it paid for its holdings. Analysts have estimated that Southeastern paid more than $20 a s! hare on average, meaning that it would lose over $800 million if the current deal was completed.
But Southeastern and its chief executive, O. Mason Hawkins, have been unafraid to challenge companies when their stock prices fall. The firm arose as a major force for change at Chesapeake Energy last year, eventually winning representation on the oil and natural gas driller’s board.
With Dell, the fight has a long road ahead. The vote for shareholders to approve the buyout is at least several months away.
On Monday, shares of Dell closed above the buyout price for the first time since the offer was announced last week.
