Icahn: You Cahn't!

Speed bumps along the way to taking Dell private:

In a new letter to shareholders, [billionaire investor Carl] Icahn foremost renews his argument that the computer company is deliberately sabotaging itself, to create the appearance that the business is deteriorating in a way that would make investors more likely to take the easy route out and accept the $24.4 billion, $13.65 a share, management-led buyout. At the same time, Icahn is offering a $14-a-share buyback program, along with a warrant that would allow investors who stick around to buy more shares (once the stock goes higher).

Another issue that Icahn addressed is the idea that his leveraged recap would take too long. A prominent proxy adviser firm last week choose the management buyout, in which Dell would sell itself to its billionaire founder Michael Dell and private equity shop Silver Lake Partners, rather than Icahn’s idea primarily because it fears the leveraged recap would prolong the comeback that Dell needs.

Icahn’s offer is slightly sweeter for Dell shareholders, but seems less likely to engineer the kind of turnaround Dell needs. Dell isn’t — I think — deliberately sabotaging itself. The company just really is in that much trouble.