txlaw Posted April 22, 2013 Author Share Posted April 22, 2013 But if you would like to see some more interesting developments related to DELL, at least on the cloud hardware front: http://gigaom.com/2013/04/02/nebula-launches-its-openstack-system/ I might work there ;) That's pretty badass. Good for you, compoundinglife! :) Link to comment Share on other sites More sharing options...
nnayyar Posted April 22, 2013 Share Posted April 22, 2013 Dell is currently trading at 13.24 with a confirmed 13.65 bid. I was looking at AUG 13 puts trading at ~0.50 as a potential play. With BX and Icahn bowing out from the process, it would seem insiders would be slightly more motivated to take the offer? I'm not sure why Michael Dell's motivation would have changed, only his case for 13.65 is bolstered. Interested in thoughts! Thanks! Link to comment Share on other sites More sharing options...
stahleyp Posted April 22, 2013 Share Posted April 22, 2013 Dell is currently trading at 13.24 with a confirmed 13.65 bid. I was looking at AUG 13 puts trading at ~0.50 as a potential play. With BX and Icahn bowing out from the process, it would seem insiders would be slightly more motivated to take the offer? I'm not sure why Michael Dell's motivation would have changed, only his case for 13.65 is bolstered. Interested in thoughts! Thanks! Yeah, I was wondering why it's trading below the offer price now, too. Kinda strange. Link to comment Share on other sites More sharing options...
Guest valueInv Posted April 22, 2013 Share Posted April 22, 2013 Your thesis: 1, Michael Dell is a genius 2, Dell management is honest 3, They're doing a great job with their acquisitions and their turnaround strategy 4, The client business doesn't matter This is a wildly inaccurate depiction of my thesis, but I suppose if it makes you feel good about your self . . . Sorry, I forgot to add that you were "speculating". Better? ;D Link to comment Share on other sites More sharing options...
nnayyar Posted April 22, 2013 Share Posted April 22, 2013 Dell is currently trading at 13.24 with a confirmed 13.65 bid. I was looking at AUG 13 puts trading at ~0.50 as a potential play. With BX and Icahn bowing out from the process, it would seem insiders would be slightly more motivated to take the offer? I'm not sure why Michael Dell's motivation would have changed, only his case for 13.65 is bolstered. Interested in thoughts! Thanks! Yeah, I was wondering why it's trading below the offer price now, too. Kinda strange. There is certainly some fear that Silver Lake is having cold feet as well however the breakup fee is around $750MM!! http://www.bloomberg.com/news/2013-04-22/silver-lake-breakup-rules-make-dropping-dell-buyout-bid-costly.html Makes walking away difficult but I guess crazier things have happened in this process! I never expected BX or Icahn to get involved. Link to comment Share on other sites More sharing options...
nnayyar Posted April 23, 2013 Share Posted April 23, 2013 The stock closed 13.10 today on heavy volume which represents 4% gross spread, ~10%annualized, using an August closing date. I initiated a small position by selling some of the Aug 13 puts. Michael Dell issued a letter today to employees, basically rah rah speech but trying to address the IDC report. http://www.sec.gov/Archives/edgar/data/826083/000119312513167404/d523827ddefa14a.htm Link to comment Share on other sites More sharing options...
boilermaker75 Posted April 23, 2013 Share Posted April 23, 2013 The stock closed 13.10 today on heavy volume which represents 4% gross spread, ~10%annualized, using an August closing date. I initiated a small position by selling some of the Aug 13 puts. Michael Dell issued a letter today to employees, basically rah rah speech but trying to address the IDC report. http://www.sec.gov/Archives/edgar/data/826083/000119312513167404/d523827ddefa14a.htm I like playing these risk arbitrage situations by writing puts. Even if the deal doesn't close on time, you have set a closing date for your play. I may do the same as you, but write some nearer term puts, May and/or June. Link to comment Share on other sites More sharing options...
nnayyar Posted April 24, 2013 Share Posted April 24, 2013 The stock closed 13.10 today on heavy volume which represents 4% gross spread, ~10%annualized, using an August closing date. I initiated a small position by selling some of the Aug 13 puts. Michael Dell issued a letter today to employees, basically rah rah speech but trying to address the IDC report. http://www.sec.gov/Archives/edgar/data/826083/000119312513167404/d523827ddefa14a.htm I like playing these risk arbitrage situations by writing puts. Even if the deal doesn't close on time, you have set a closing date for your play. I may do the same as you, but write some nearer term puts, May and/or June. I thought long about which month to sell, on one hand if there's only .10 difference between say June or August and deal breaks, the extra 0.10 won't be much consolation! Though on the other hand, given the binary situation in risk arb if good news comes out both options will pretty much price expectations similarly so why not take the extra premium? Obviously a calendar situation, for example a shareholder vote or decision is expected one month and then pushed out (NXY had a setup like this) then it could be a homerun! Ultimately....I'm not really sure. I guess more important question to ask is what do you think the probability of closing is? market implied looks to be 89% which seems low but not glaringly so. Link to comment Share on other sites More sharing options...
txlaw Posted April 24, 2013 Author Share Posted April 24, 2013 MSD letter to the troops: http://www.sec.gov/Archives/edgar/data/826083/000119312513167404/d523827ddefa14a.htm Link to comment Share on other sites More sharing options...
nnayyar Posted April 24, 2013 Share Posted April 24, 2013 OakMark sells DELL: http://blogs.wsj.com/moneybeat/2013/04/24/oakmark-funds-sold-dell-stake-after-blackstone-withdrew-bid/?mod=yahoo_hs Despite saying in their last commentary they would hold DELL expecting a better offer, they actually decided to sell it all, ~13MM shares. I would assume the natural buyers are actually arbs, and while I am biased as of yesterday, I think that's actually somewhat positive as they are more likely to accept the 13.65 and move along. Link to comment Share on other sites More sharing options...
nnayyar Posted May 10, 2013 Share Posted May 10, 2013 SouthEastern and Icahn alternate proposal: http://www.sec.gov/Archives/edgar/data/826083/000092846413000106/dellsch13d051013.htm Link to comment Share on other sites More sharing options...
alwaysinvert Posted May 10, 2013 Share Posted May 10, 2013 http://www.bloomberg.com/video/icahn-says-dell-won-t-run-company-if-offer-succeeds-lL~w0LwSRCaqXEFBoN0JPQ.html Link to comment Share on other sites More sharing options...
wachtwoord Posted May 10, 2013 Share Posted May 10, 2013 http://www.bloomberg.com/video/icahn-says-dell-won-t-run-company-if-offer-succeeds-lL~w0LwSRCaqXEFBoN0JPQ.html I hope this materializes. (I'm still holding) Link to comment Share on other sites More sharing options...
Guest wellmont Posted May 10, 2013 Share Posted May 10, 2013 I am beginning to appreciate Carl Icahn more and more for being one of the most rational actors on the investing stage. Just don't be a minority shareholder in a company he controls. Link to comment Share on other sites More sharing options...
wachtwoord Posted May 10, 2013 Share Posted May 10, 2013 Could you elaborate on that? Link to comment Share on other sites More sharing options...
Guest wellmont Posted May 10, 2013 Share Posted May 10, 2013 Could you elaborate on that? try to research the history of a company called XO communications. Link to comment Share on other sites More sharing options...
wachtwoord Posted May 11, 2013 Share Posted May 11, 2013 Could you elaborate on that? try to research the history of a company called XO communications. Damn, what he did there is basically as scammy as what Michael Dell is doing here. I would call both theft. Anyway, under the proposed conditions Icahn and Southeastern would end up with 55% interest if no-one but them opts for the $12 in shares instead of the $12 in cash per share. Because I want to own Dell I would opt for the shares and I think many more will too, most likely reducing Icahn and Southeastern's share to <50%. I don't feel exactly right with that too however considering Icahn's past. I would prefer that all take-over offers are withdrawn and I can just continue to hold Dell as it is because I think it's worth significantly more and I'm actually not a fan of a large amount of leverage. Link to comment Share on other sites More sharing options...
krazeenyc Posted May 16, 2013 Share Posted May 16, 2013 anyone know the tax treatment of the $12 a share "dividend" under the icahn proposal? it woudln't be a qualified dividend woudl it? Link to comment Share on other sites More sharing options...
T-bone1 Posted May 16, 2013 Share Posted May 16, 2013 anyone know the tax treatment of the $12 a share "dividend" under the icahn proposal? it woudln't be a qualified dividend woudl it? Good question Krazee. I would think that it would be either treated as a qualified dividend, un-taxed as a return-of-capital, or some combination of the two. I'm sure someone on the board has a much better idea than me though . . . Link to comment Share on other sites More sharing options...
compoundinglife Posted May 20, 2013 Share Posted May 20, 2013 Dell canning its openstack based public cloud: http://gigaom.com/2013/05/20/dells-revised-strategy-steps-back-from-openstack-public-cloud-spotlights-enstratius/ Acquires Enstratius: http://gigaom.com/2013/05/06/dell-snaps-up-enstratius-to-build-cloud-momentum/ Link to comment Share on other sites More sharing options...
wachtwoord Posted May 20, 2013 Share Posted May 20, 2013 Dell’s Board Can’t Decide if Carl Icahn Is Serious. Seriously, the board of Dell is full of scum. Link to comment Share on other sites More sharing options...
Guest valueInv Posted May 29, 2013 Share Posted May 29, 2013 I have said this before, its not just Dell's client business that is under attack, its also the server business: http://gigaom.com/2013/05/28/other-server-vendors-keep-gaining-momentum-while-hp-oracle-slide/ MOS, indeed. Link to comment Share on other sites More sharing options...
Guest valueInv Posted May 30, 2013 Share Posted May 30, 2013 And there's more: http://gigaom.com/2013/05/29/killer-cloud-report-says-amazon-web-services-threatens-all-it-incumbents/ Where is Txlaw with the Clayton Christensen quotes when you need him? ;D Link to comment Share on other sites More sharing options...
Cardboard Posted May 30, 2013 Share Posted May 30, 2013 Don't know about Txlaw, but I can give you a Carl Icahn quote: "Where is ValueInv on the Forbes 400 list?" Cardboard Link to comment Share on other sites More sharing options...
Guest valueInv Posted June 1, 2013 Share Posted June 1, 2013 Don't know about Txlaw, but I can give you a Carl Icahn quote: "Where is ValueInv on the Forbes 400 list?" Cardboard Why would I be on the Forbes 400? Link to comment Share on other sites More sharing options...
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