Michael S. Dell may have to raise his $24.4 billion bid for the computer company he founded, DealBook’s Michael J. de la Merced reports. A special committee of Dell’s directors encouraged Mr. Dell over the weekend to raise the offer price of $13.65 a share, a person briefed on the matter said on Tuesday. But Mr. Dell has not committed to a course of action and has not discussed raising the current price with his private equity partner, Silver Lake, Mr. de la Merced reports.
Pressure is growing as two big shareholders, Carl C. Icahn and Southeastern Asset Management, continue to attack the deal before a shareholder vote set for July 18. And the special committee is growing worried that the buyout offer will fail to win enough support. “The directors have already taken a number of meetings with major invesors that have left them pessimistic about the bid’s prospects, and now believe that a major shareholder advisory firm is poised to recommend a rejection of the takeover,†Mr. de la Merced writes.
Mr. Dell would be the most likely source of any additional money. “Silver Lake, which had refused to raise the bid beyond $13.60 at one point, has become increasingly worried about the deterioration of Dell’s business, a person close to the firm said. At the moment, it would not be devastated if the deal fell apart,†Mr. de la Merced reports.
AGENCY SPLIT OVER TRADING RULES ABROAD  | With a July 12 deadline to complete rules that would rein in lucrative trading by banks overseas, the Commodity Futures Trading Commission is divided over the plan, DealBook’s Ben Protess reports. Amid pressure from W! all Street lobbyists, the agency, which is known for its cordial style and unanimous votes, is experiencing “a rare breakdown of decorum,†Mr. Protess writes.
Mark Wetjen, a Democratic commissioner who holds the swing vote, recently called the deadline “arbitrary.†He irked some colleagues last week when, without warning them, he delivered a speech to bankers in London that called for a new “interim†plan, according to an e-mail reviewed by The New York Times, Mr. Protess writes. “Even in a town known for its partisan outbursts and vitriolic finger-pointing, the tension at the agency was striking to political insiders,†Mr. Protess says. One Congressional aide put it this way: “It’s like the seventh grade but without the lollipops.â€
A TO-DO LIST FROM THE FED  | The Federal Reserve approved a sweeping new set of rules on Tuesday intended to reduce the riskiness of banks and make the more resilient to losses, DealBook’s Peter Eavis writes. The rules, stemming from an international agreement known as Basel III, require that banks maintain high-quality capital â€" the all-important cushion against losses â€" equal to 7 percent of their loans and assets, with the biggest banks potentially required to hold more than 9 percent.
“The Basel approach to capital has drawn criticism, however,†Mr. Eavis writes. “For one thing, it uses something called risk weighting, which means less capital can be held against loans or bonds that are perceived to be less risky even though they may end up producing higher-than-expected losses. Basel may also give banks too much leeway when calculating how much capital they have to hold, because the banks get to apply the risk weightings. Finally, for some, Basel’s capital ratios are simply too low to protect a bank from a real shock.â€
ON THE AGENDA Â |Â A report on the international trade deficit for May is out at 8:30 a.m. Edward Djerejian, a former ambassador who is chairman of Occidental Petroleum, is on Bloomberg TV at 1:30 p.m.
KOCH BROTHERS WANT A BIGGER ROLE IN DEALS  | The billionaire brothers Charles and David Koch have a message for Wall Street: pitch us the type of deals you would pitch to Warren E. Buffett. In an interview with The Wall Street Journal, Charles Koch, the chairman and chief executive of Koch Industries, said of Mr. Buffett: “He’s done a great job of having a brand that if you want to sell your business and continue to run it, come here.†The chief financial officer of Koch Industries, Steve Feimeier, said some sellers have pitched Mr. Buffett alone “because he was viewed as the only person who could write a hefty check [and] could do it very quickly.†But the Kochs, according to the newspaper, want it to be known that they can do that, too.
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Founding Family Raises Bid for American Greetings  | The founding family of American Greetings has raised its offer to take the company private to $19 a share from an earlier bid of $18.20. DealBook »
Diller Is Fined Over Coca-Cola Trades  | Barry Diller agreed to pay $480,000 in fines over what regulators said were violations of disclosure rules when he bought shares of Coca-Cola between 2010 and 2012. WALL STREET JOURNAL
At Microsoft, Skype President May Get a Role in Deals  | Steven A. Ballmer, chief executive of Microsoft, “is considering a reorganization that would put Skype president Tony Bates in charge of acquisitions and relationships with software developers, according to people familiar with the matter,†Bloomberg News reports. BLOOMBERG NEWS
Cargill Said to Consider Buying Unit of A.D.M.  | Cargill “has explored the possibility of buying†the cocoa business of Archer Daniels Midland, Reuters reports, citing an unidentified person familiar with the situation. REUTERS
Front-Runner Emerges to Lead Time Inc.  | Michael Klingensmith, former chief financial officer of Time Inc., “is a leading contender to become chief executive of the magazine giant, which is due to be spun out of Time Warner Inc. around the end of the year, say people familiar with the matter,†The Wall Street Journal reports. ! WALL STREET JOURNAL
Rosneft Takes Over Russian Gas Producer in $2.9 Billion Deal  | Rosneft says it is buying the 49 percent of the Itera Oil and Gas Company that it does not already own for $2.9 billion in a bid to expand the company’s relatively modest natural gas operations. DealBook »
Yahoo Buys Qwiki, Movie-Making App  | The deal for Qwiki, which makes an app that lets people turn photos, music and videos into short movies, was said to be worth around $50 million, according to AllThingsD. ALLTHINGSD
S! .&P. Cuts! Ratings of 3 European Banks  | Barclays, Deutsche Bank and Credit Suisse had their credit ratings reduced by Standard & Poor’s, which cited “uncertain market conditions.†BLOOMBERG NEWS
Goldman Faces Arbitration Claim Over Sale of Securities  | The National Australia Bank is pursuing a $230 million arbitration claim against Goldman Sachs over sales of mortgage-linked securities that declined in value, The Wall Street Journal reports. WALL STREET JOURNAL
A Lucrative Business at Citigroup Catches Rivals’ Attention | Citigroup may face increased competition in transaction services, a moneymaker since the financial crisis, Reuters writes. REUTERS
R.B.S. to Cut Up to 1,800 Jobs in Irish Unit  | The Royal Bank of Scotland plans to eliminate as many as 1,800 jobs at its Ulster Bank Group unit in Ireland as it aims to make the business profitable again by 2016. DealBook »
An E.T.F. Too Far  | In the wake of the hoopla over the proposed Winklevoss exchange-traded fund in bitcoins, Peter Thal Larsen of Reuters Breakingviews offers a modest proposal.! REUTERS BREAKINGVIEWS
Carlyle Said to Consider I.P.O. for CommScope  | The Carlyle Group may pursue an initial public offering of the CommScope Holding Company, a telecommunications equipment firm it bought for $3.9 billion, including debt, in 2011, Reuters reports, citing two unidentified people familiar with the matter. REUTERS
Investors Pull $9.6 Bllion From Pimco Fund  | Investors pulled a record amount of money from Pimco’s flagship Total Return bond fund in June, a stark indication of how rising interest rates have pushed bonds out of favor. DealBook »
New Bank Product: Hedge Funds for Small Investors  | CNBC reports: “Several investment banks are said to be eyeing the launch of hedge funds for retail investors with minimum investments as low as $1,000 following the launch of a Goldman Sachs fund in May that raised $58 million in less than two months.†CNBC
Suntory Unit’s $4 Billion I.P.O. Rises in Tokyo Trading Debut  | Shares in Suntory Beverage and Food gained modestly in their debut in Tokyo on Wednesday despite the recent shaky response to new offerings in markets around the world. DealBook »
Homebrew, a New Venture Capital Firm, Raises First Fund  | Run by a former Google executive and a former Twitter executive, Homebrew raised $35 million for its first fund, Fortune reports. FORTUNE
Prudential Objects to Systemic Label  | Prudential Financial said in a securities filing on Tuesday that it would contest its designation as a systemically important institution by the Financial Stability Oversight Council. DealBook »
Cengage Learning Files for Bankruptcy | The education company Cengage Learning, backed by private equity, has filed for Chapter 11 bankruptcy protection as part of an effort to reduce its $5.8 billion debt load. DealBook »
Requiring Defendants to Admit Guilt Will Be Costly for S.E.C.  | The Securities and Exchange Commission’s new policy on requiring some defendants to admit misconduct when settling cases will make pursuing the big fish draining for the agency, David Zaring of the Wharton School of Business writes in the Another View column. DealBook »
Judge Approves HSBC’s Settlement! of Money! -Laundering Charges  | The settlement with federal and state regulators was worth $1.92 billion. REUTERS
