Can Michael Dell Withstand This Investor Revolt?

Michael Dell’s $24.4 billion proposal to take his namesake company private can make history as the biggest leveraged buyout since the financial crisis, but the deal is garnering more attention for the shareholder revolt it has prompted than for its size. After all, Dell’s (NASDAQ:DELL) independent shareholders think that the PC-maker is worth much more than the offered price of $13.65 per share, and if they get their wish, the amount of money involved could balloon.

Before the deal was made official, shareholders such as Pzena Investment Management (NYSE:PZN) warned that they would not support a proposal that valued the company at less than $20 per share. Now, Mr. Dell has on his hands the biggest shareholder uprising in years, just as was promised.

Bernstein analyst Toni Sacconaghi wrote in a late January research note seen by Barron’s that “simple math” indicated that the Dell leveraged buyout would likely be approved. Mr. Dell’s stake of 15 percent combined with the holdings of takeover arbitrageurs and index funds would create a formidable force for shareholders to oppose…