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By | Brid-Aine Parnell 19th April 2013 12:44

Blackstone gives up on $25bn bid to snatch Dell from Mr Dell

You know what? Knock yourself out, Michael

Private-equity fund Blackstone has reportedly given up its efforts to splurge $25bn on whipping Dell out from under Michael Dell's nose.

Blackstone, which is a Dell shareholder, and activist investor Carl Icahn had hoped to together make a rival bid for the Texan computer giant, but are now unconvinced that it is worth more than its current market valuation, people familiar with the details muttered to the Financial Times.

Dell's share price of $13.95 currently values the company at $24.4bn. Company founder Michael Dell and his pals at Silver Lake Partners together want to take the firm private at $13.65 per share.

Blackstone had said it was interested in topping Dell's price in a joint offer with Insight Venture Partners and Francisco Partners, and was also rumoured to be in talks with tech companies to join its bid.

But the sources said that Blackstone's management are concerned about the fund's ability to disentangle itself from Dell in a profitable way when the time comes to find the computer maker a new owner.

Dell's special committee has claimed to be so confident that the Mike D deal is the best, it would reimburse Blackstone and the other competing group led by Icahn Enterprises for their work in considering their bids, up to $25m.

Shareholders have not been as uniformly delighted by the prospect of the deal, with some like Icahn and Southeastern Asset Management arguing that Mike D's offer doesn't give enough to stockholders.

Carl Icahn has made the highest value bid, offering to buy 58 per cent of Dell for $15 a share. He's also refused the commitee's offer of reimbursement if he dropped the option of a proxy battle - rallying shareholders to vote against the Mike D deal - saying he still wanted to be able to do that. ®

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