Filed by Dell Technologies Inc.
Pursuant to Rule 425 under the Securities Act of
1933
and deemed filed pursuant to Rule 14a-6 of the
Securities Exchange Act of 1934
Subject Company: Dell Technologies Inc.
(Commission File No. 001-37867)
NOTICE TO STOCKHOLDERS
November 19, 2018
Dear
fellow stockholders of Dell Technologies Inc.:
We are writing to let you know that Dell Technologies has enhanced the value and terms of the Class V
transaction. The improvements in price, value certainty and corporate governance in the Class V transaction are the result of substantial engagement with and input from our stockholders and the special committee of our board of directors since
we first announced the transaction. We appreciate the time, attention and constructive feedback provided by our stockholders and look forward to our future partnership as owners of Dell Technologies.
Stockholders representing approximately 17% of the total outstanding Class V common stock, including Dodge & Cox, Elliott Management, Canyon
Partners and Mason Capital Management, have announced their support for the Class V transaction. They have signed binding agreements supporting the Class V transaction, demonstrating their belief that the Class V transaction is in the
best interests of all Class V stockholders and provides a clear path to significant stockholder value creation. Further, the feedback we have received from other stockholders on the revised terms has been overwhelmingly positive.
On November 14, 2018, we amended the merger agreement (the merger agreement amendment) to provide Class V stockholders with a
significant premium, increased certainty of value, and enhanced corporate governance. Specifically, Class V stockholders have the option to elect to receive for each share of Class V common stock either (1) $120, in cash, subject to an
increased aggregate $14 billion cap, or (2) between 1.5043 and 1.8130 shares of Class C common stock, determined as described below.
Given
that there is no public market for Dell Technologies Class C shares prior to closing, the variable exchange ratio is specifically designed to provide protection to Class V stockholders on the value of the Class C stock consideration.
The exchange ratio will be determined based on (1) the volume weighted average trading price of the Class V shares during the
17-day
trading period ending on the election deadline, which is the
eighth trading day after announcement that stockholders have approved the transaction, and (2) the total amount of cash consideration that is elected.
Appendix A
to this letter provides further information on the calculation of the
exchange ratio.
The cash consideration of $120 per share of Class V common stock offers Class V stockholders a significant premium of 42% to
the closing market price of the Class V common stock on the last trading day prior to the announcement of the merger agreement on July 2, 2018. We are also pleased to be able to offer stockholders greater value certainty through the
increased cash component of the consideration and the variable exchange rate mechanism, which was added in direct response to stockholder feedback.
Additionally, the Class V transaction is accompanied by corporate governance enhancements that were developed in response to input from the Class V
stockholders. These include the addition of a fourth independent director to be appointed to the Dell Technologies board of directors by June 30, 2019, after consultation with the Class C stockholders, and the right of Class C
stockholders, voting separately as a class, to elect one director starting at the 2020 annual meeting and annually thereafter.
We believe that the
Class V transaction will afford Class V stockholders the opportunity to participate in the future value creation of Dell Technologies through ownership of the Class C common stock. We have made significant investments to position our
company to achieve sustainable long-term growth by creating a leading global
end-to-end
technology provider, with significant scale, leading positions in key strategic
markets and a comprehensive portfolio of IT hardware, software and service solutions spanning both traditional infrastructure and emerging, multi-cloud technologies. We believe we are well-positioned for future growth as we enable our customers to
meet the business needs of tomorrow.
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