July 12, 2018
The Special Committee of the Board of Directors of Dell Technologies ("Dell") representing the holders of Dell's Class V Common Stock (NYSE: DVMT) has disclosed details of its comprehensive process to protect and maximize value for the holders of Class V Common Stock in a negotiated conversion of the Class V Common Stock into shares of Dell's Class C Common Stock with a cash election option. Under the terms of the transaction, shares of Dell's Class V Common Stock will be converted into the right to receive a fixed number of shares of Dell Class C Common Stock at an exchange ratio of 1.3665 shares of Class C Common Stock for every share of Class V Common Stock. Based on an implied value of US$109 per share of Class V, this would represent an equity value for Dell's DHI group of US$48.4 billion and total consideration to holders of Class V shares of US$21.7 billion. Alternatively, holders of Class V shares can elect to receive US$109 per share in cash in an aggregate amount not to exceed US$9 billion.
Following the completion of the transaction, the Class C Common Stock will be listed on the NYSE, and Dell's governance will conform to the post-IPO governance structure provided by the Dell certificate of incorporation and other governance documents. The transaction remains subject to approval by a majority of the unaffiliated holders of the Class V Common Stock and is expected to close in the fourth quarter of calendar year 2018.
Latham & Watkins LLP represents The Special Committee of the Board of Directors of Dell Technologies in the transaction with a corporate deal team led by partners Mark Gerstein, Bradley Faris, and Cathy Birkeland, with associates Daniel Breslin and Megan Staub in Chicago. Orange County partner Michele Johnson advised on compliance matters.