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Icahn Abandons Bid To Prevent Dell From Going Private 51

Via El Reg comes news that Carl Icahn has, after a brief battle with Michael Dell for control over the company, thrown in the towel. From the article: "Icahn said in an open letter to shareholders that he still thought that Big Mike's $13.88 per share offer for the firm undervalued it, but had decided that it would be 'almost impossible' to win the battle at the shareholder vote on Thursday. 'I realize that some stockholders will be disappointed that we do not fight on,' he wrote. 'However, over the last decade, mainly through "activism," we have enhanced stockholder value in many companies by billions of dollars. We did not accomplish this by waging battles that we thought we would lose.'"
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Icahn Abandons Bid To Prevent Dell From Going Private

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  • Translation (Score:5, Insightful)

    by whisper_jeff ( 680366 ) on Tuesday September 10, 2013 @07:12AM (#44806335)

    Translation: I've pumped the value of Dell stock as high as I'm going to get it to go so I now have my eyes set on pumping the value of a different company's stock through my "activism".

    I do appreciate that he air-quoted "activism"...

  • Re:Translation (Score:4, Insightful)

    by Charliemopps ( 1157495 ) on Tuesday September 10, 2013 @07:55AM (#44806493)

    yea, but public companies tend to bust. You can shrink a private company, take losses for a while if you want. When you're public the public expects eternal growth or they abandon you, you get bought up and sold for pennies on the dollar and then the company you named after yourself sells its rights to walmart who then sells cheap knock-offs under your name.

  • by LostMyBeaver ( 1226054 ) on Tuesday September 10, 2013 @08:31AM (#44806689)
    When a company goes public, it allows professional gamblers buy parts of the company in order to raise money. At this point, these gamblers demand that the company post regular results and news no matter how silly to give them some reason why other gamblers should buy these shares... or vouchers for a higher value. The value of this voucher on the gambling market almost never reflect the actual performance of the company. And the gambler market value has little actual impact on the actual value of the company. It's similar in nature to how betting on a horse doesn't make it run faster. Gambling on a football game doesn't actually alter the results of the game.

    When a company like Dell volunteers to remove itself from the gambling pool because the people who run it feel they'd prefer the value of the company is actually based on the actual results of its performance, it is highly responsible. Like paying off a loan to the bank because you don't need the loan anymore.

    While every experience I've ever had with Dell has been that they're a company full of hackers who lack the ability to do anything other than repackage technology they don't actually understand, I applaud them for setting a great example of financial responsibility even against the will of gamblers who pressure them to behave irresponsibly for their own personal gains.

    I would like to see many other companies take the same path. Other tech companies, food companies, manufacturing companies, etc. The first step to fixing the U.S. economy is to gamble less and behave responsibly.

    Let's hope this becomes a trend. Good job Dell!
  • Re:Translation (Score:2, Insightful)

    by Anonymous Coward on Tuesday September 10, 2013 @09:12AM (#44806993)

    Many of those companies have the "Reduce cost at any expense" mantra well learned.
    Causing them to spend more money on the reduction than the savings from the reduction, on paper it looks good, in reality you are destroying the company.

I go on working for the same reason a hen goes on laying eggs. -- H.L. Mencken