Dell committee accepts founder’s increased offer to take the tech giant private

Michael Dell’s hopes of being allowed to take the company he founded private received a significant boost on Friday after a special committee of Dell’s board agreed to accept an increased offer that would see the tech mogul tack a dividend to his original offer.

Michael Dell, along with partner firm Silver Lake, last week offered to buy the company at a price of $13.75 per share. The revised offer will see an extra 13c paid out to shareholders for each share owned.

As part of the augmented deal, Michael Dell will be allowed to avail of new, more favourable voting rules. Before, ballots which had not been marked because their holders abstained counted as votes against; the new rules will see abstainers not counted. Experts believe that the new paradigm will force those in the middle to climb down from the fence or withdraw their vote, conditions which are expected to benefit Michael Dell’s bid.

The offer will also see the prospective new owners guarantee that the company’s 8c-per-share third-quarter dividend is paid promptly.

“The committee is pleased to have negotiated this transaction, which provides as much as $470 million of increased value, including the next quarterly dividend that will now be paid regardless of when the transaction closes,” commented Alex Mandl, Chairman of the Special Committee.

Mandl also expressed his delight at the new voting system proposed by Michael Dell, saying that it provides a “level playing field” for shareholders. He explained that the original system was designed to facilitate a vote on whether to accept a bid or to maintain the status quo, and that it was not suitable for a straight yes/no ballot.

The new offer was approved just 30 minutes before shareholders were due to meet, most likely to reject the offer. Since, several angry shareholders have voiced criticism of the board’s handling of the offer, claiming that some of its members openly displayed favouritism for Michael Dell, ignoring other options.

Among the shareholders to voice their anger was Carl Icahn, who had tabled an alternative offer in conjunction with property firm Southeastern Asset Management. Icahn, who announced his intention to sue Dell on Thursday in an attempt to prevent the company from changing the recorded date of Michael Dell’s first offer, criticised the offer for falling short of what investors should have been offered.

The vote had already been delayed twice as Michael Dell could not rally enough support to make a count worthwhile.

The ballot on whether or not Michael Dell will be allowed to take the company he founded as a teen private will take place on September 12.

After the announcement was made by Dell’s board, shares in the company rose by more than 5 per cent – or 64c – to $13.65, a three-month high.

Potential Attack Prompts US State Department Travel Alert

The US State Department has issued a travel alert to all US citizens planning to travel to abroad, advising them to keep vigilant and be aware of the threat of a potential terrorist attack.

The warning, which has already prompted the US government to temporarily shut a number of its embassies around the world, focuses on the threat posed by militant groups linked to al-Qaida in North Africa and the Arabian Peninsula, the department said, without being more specific.

“The Department of State alerts US citizens to the continued potential for terrorist attacks, particularly in the Middle East and North Africa, and possibly occurring or emanating from the Arabian peninsula,” read a statement issued by the department.

“Current information suggests that al-Qaida and affiliated organisations continue to plan terrorist attacks both in the region and beyond, and that they may focus efforts to conduct attacks in the period between now and the end of August,” the statement explained.

The State Department said that the alert will remain in place for the entire month, expiring effective August 31. It said that its decision to close some embassies was taken purely out of caution and that they will remain closed beyond Sunday – a business day in Muslim countries.

The warning comes as the end of the Muslim holiday of Ramadan approaches – a period when fighting is traditionally put on hold – approaches.

Several high-ranking legislative officials have spoken out about the seriousness of the threat. Ed Royce, a Republican and the chairman of the House Foreign Affairs Committee said that the committee is aware of “a series of threats”. “In this instance, we can take a step to better protect our personnel and, out of an abundance of caution, we should”.

House Intelligence Committee member Dutch Rupersberger said that the committee’s most important duty is the protection of American lives and that the warning was not issued as a result of the “regular chit-chat” it normally analyses.

Although the warning is aimed specifically at US citizens, its message has been heeded by a multitude of global bodies, including the European Union, which issued a statement saying it is taking “all necessary precautions” to ensure safety within its borders.

Alerts like the one today are often issued around international events or widely observed anniversaries. One of the last notable alerts was issued by the State Department last year on the anniversary of the September 11 attacks, after which the US ambassador to Libya and three others were killed as protests raged in Benghazi.

Media speculation suggests that today’s alert may be somehow connected the inauguration of the newly elected Iranian president, Hassan Rouhani, which will take place on Sunday.

The State Department is recommending that all US citizens planning to travel abroad register their plans with the Consular Section of the US Embassy through its travel registration website and that they enrol in the Department’s Smart Traveller Enrolment Programme.

TransCanada to proceed with $12 billion cross-country pipeline

North American energy firm TransCanada Corp has revealed that it has decided to proceed with a $12 billion plan to begin transporting large quantities of oil from the west of Canada to the country’s east coast. The project, which involves constructing a lengthy new conduit, dubbed the Energy East pipeline, is the largest ever undertaken by the company and has been lauded by politicians, interest groups and industry professionals throughout the country.

TransCanada, based in Calgary, hopes to deliver 1.1 million barrels per day through its new pipeline. It hopes to begin supplying terminals in Quebec in 2017 and New Brunswick a year after. The oil will be pumped from receipt points in Alberta and Saskatchewan. Of the 1.1 million bpd that will be produced, 900 million are secured by long-term, binding commitments the company has already entered into with shippers.

Although 3,000km of the pipeline to be used is already underground, a further 1,400km of new pipes will need to be laid through Quebec, Alberta, Saskatchewan, and Manitoba. The 3,000km already underground is currently used for gas transportation and will need to be converted.

Although the project is yet to receive full regulatory approval, it has been given the thumbs up by two provincial governments – New Brunswick and Alberta – and is hoping to secure the blessing of a third – Quebec – in the near future. It will also be subject to an environmental review.

TransCanada chief executive Russ Girling likened the project to the Canadian Pacific Railway and the Trans-Canada Highway, ambitious ventures which in their time delivered new economic opportunities to millions of Canadians. “This is a historic day for TransCanada and a historic day for our country,” he said.

“Each of these enterprises demanded innovative thinking and a strong belief that building critical infrastructure ties our country together, making us stronger and more in control of our own destiny.”

TransCanada’s announcement was welcomed by Canadian Natural Resources Minister Joe Oliver, who said that the new pipeline will mean a better deal for refiners and will provide a way for the country to reduce its reliance on foreign imports.

Alberta finance minister Doug Horner also commented on the news, saying that the pipeline will have a “huge” impact throughout his province. “The impact is going to be huge because obviously if you can move a million barrels per day to the eastern seaboard and get additional markets that perhaps we weren’t looking at getting into as quickly as this, that’s going to have a pretty significant impact on investment decisions for Alberta,” he explained.

The pipeline also has its detractors. Despite receiving ringing endorsements from public officials, some critics are sceptical about whether the project can deliver the energy security and job creation its backers promise. Similar worries have already led to the delay of another project, linking pipelines in Canada with one further south in the United States. The Keystone pipeline, which could pipe 300,000 bpd between the two markets, has been awaiting US State Department clearance for several years. President Obama is expected to make a definitive decision sometime later this year.

As well as announcing that it’s green lighting the development of the pipeline, TransCanada also announced that will partner with Irving Oil in building a new export terminal near Saint John, New Brunswick. The company announced that the new terminal’s capacity will be 30 per cent greater than it had originally planned after receiving greater-than-expected interest from shippers.

Nintendo Returns to Profit Despite Weak Sales

Japanese games giant Nintendo has posted a return to profit for the second quarter of the year despite being unable to reverse declining across the board sales. Nintendo, which is battling hard against larger rivals Microsoft and Sony, benefited from a weaker yen and more favourable trading conditions in the three months to the end of June, the company said in a statement.

Nintendo reported a net profit of $88 million, a significant gain on the $17.2 billion loss it recorded for the same quarter last year. The company’s loss in 2012, it said, was also significantly influenced by currency valuation fluctuations, with the yen much stronger at this time last year.

Sales, the company said, suffered as more consumers turn to cheaper games options, including mobile gaming. Nintendo managed to generate sales of $832 million over the period, a fall of nearly 4% on the same time last year. The company said it hopes the release of a number of new titles including The Legend of Zelda: The Wind Waker HD and Donkey Kong Country: Tropical Freeze will help to revive sales ahead of the holiday season.

Tough economic conditions in Europe and the United States – two of its largest markets – remains one of the company’s largest concerns, it said in its statement, along with the competition posed by smartphone app manufacturers, whose products are continuing to erode console makers’ profits.

To counter the appeal of cheap, or sometimes free, app offerings, Nintendo has released two new high-tech games machines – the 3DS and Wii U. Despite lower-than-expected initial sales figures for the 3DS, the world’s first gaming device with a 3D screen, and the Wii U, the successor to the popular Wii console, the company says it is still confident the devices can appeal to the mass market. The company said that it sold 1.4 million 3DS units in the quarter, way below expectations.

Nintendo says that it will be concentrating on promoting the Wii U through the next few quarters. “For the Wii U system we will attempt to concentrate on proactively releasing key titles from the second half of the year through next year to regain momentum for the platform,” Nintendo explained in its statement.

The comments came after the company posted disappointing console sales figures for the Wii U, revealing that it shifted just 160,000 units between April and June, a drop of 50% on the first quarter of the year. The company blames a series of delays in the console’s release for its slow start. It chose not to alter its prediction of sales of up to nine million units by March next year.

The company refused to be drawn to calls for it to enter the apps market, saying that its consoles aren’t phones, and are part of an altogether different gaming category. It did however take the opportunity to reveal the release of a new black version of the 3DS, which the company says will be available to buy from August 11.

Moyes Officially Named Manchester United Manager

David Moyes has officially taken up his post as manager of Manchester United following the opening of the summer transfer window at midnight last night.

Moyes, who joins the Red Devils from Everton, where he spent the last eleven years as manager, comes to the club as it struggles to hold onto star striker Wayne Rooney, who surprised fans by handing in a second transfer request earlier in the summer early in June, reports Sky Sports.

Rooney, who was sold to Manchester United by Moyes at Everton after the England international’s quick rise to prominence as a teenager, is keen to exit Old Trafford after a public falling out with ex-manager Alex Ferguson, and has made no secret of his desire to find a new home away from England.

As well as being tasked with keeping hold of Rooney, Moyes will also be expected to bring in some fresh faces, with ex-United and current Real Madrid star Cristiano Ronaldo top of fans’ wishlists. Moyes is also thought to be keen to add strength from his old Everton guard, with highly rated defenders Leighton Baines and Seamus Coleman touted to be on Moyes’ radar, and striker Marouane Fellini thought to be on his way out of the club, so says BBC Sport.

Moyes has also made additions off the pitch, taking several of the coaching staff with him to Old Trafford, according to the Guardian. Steve Round, Chris Woods and Jamie Lumsden will join the backroom team at Old Trafford, replacing assistant first team manager Mike Phelan, goalkeeping coach Eric Steele and first team coach Rene Meulensteen respectively.

“I have worked with Steve, Chris and Jimmy for a number of years and am delighted they have decided to join me at this great club. They bring qualities in their respective fields and I know that, like me, we can build upon the success this club has enjoyed over many years,”

Despite being hand-picked by Ferguson, who spent more than a quarter of a century holding the reigns at Old Trafford, Moyes’ appointment has not pleased everybody. Critics of the Scot point to the 50-year-old’s lack of European football experience, with many detractors expressing their frustration that a high-profile name like Jose Mourinho or Pep Guardiola was not sounded out for the job earlier.

Three Newly Discovered Exoplanets Could Yield Life

Astronomers in Germany have announced the discovery of three planets in a star system some twenty-two light years from Earth. The exoplanets, which are all believed to be rocky super-earths, orbit their host star in the so-called “Goldilocks” zone – where the temperature is not too hot and not too cold — meaning they may be capable of sustaining organic life, astronomers say.

The planets were discovered in a solar system which bears similarities to our own, astronomers at the University of Gottingen revealed. Between five and seven planets orbit Gliese 677C star – part of a trinary system called Gliese 667.

“We identified three strong signals in the star before, but it was possible that smaller planets were hidden in the data. We re-examined the existing data, added some new observations, and applied two different data analysis methods especially designed to deal with multi-planet signal detection,” commented Guillem Anglada-Escude, who led the initiative.

“Both methods yielded the same answer: there are five very secure signals and up to seven low-mass planets in short-period orbits around the star,” he continued.

The Gliese 667C system is unique as it is the first solar system discovered with more than one planet orbiting within its star’s habitable zone. In our own solar system the Earth is the only planet within the Sun’s “Goldilocks” zone, with Venus and Mars orbiting marginally outside.

The host star in the Gliese 997C system is just one-third the mass of our Sun, making the discovery of three planets within its habitable zone all the more impressive.

The newly discovered planets lie in the constellation Scorpius – which, at twenty-two light years away, is right in Earth’s cosmic back garden, and much closer than the stars being scanned by Nasa’s advanced Keplar telescope.

The discovery came about after scientists peering through the European Southern Observatory’s Very Large Telescope took another look at the Gliese 667 system, where they had already discovered three planets outside the host star’s habitable zone.

The discovery of the three new planets may mean that more habitable planets occupy the Milky Way than first thought.

US Regulators Ready to Engage Virtual Currency Operators

A top US regulator has provided the strongest indication yet that Washington is ready to engage virtual currency operators for the first time.

The decision was prompted by the recent fall of high profile digital currency service Liberty Reserve, which operated as a black market bank according to prosecutors, since its incorporation in Costa Rica in 2006.

Bart Chilton, a commissioner at the Commodities Futures Trading Commission, suggested that transactions facilitated by digital currency operators may fall under the remit of US tax collectors in an interview with the FT, mentioning transactions completed through the popular – and as of yet unregulated – digital currency Bitcoin.

The news is a positive development both digital currency users, who until now have had to conduct business in an environment with no discernible regulation, and for payment facilitators, who will be welcomed in from the cold by panicked Washington, where Liberty Reserve’s fall, viewed in some quarters as the largest black market operation of all time, has prompted calls for action.

Leading the charge for the integration of virtual currencies to the US tax system is the Internal Revenue Service (IRS), which is losing out on billions of dollars in tax: Liberty Reserve alone is estimated to have helped its customers hide up to $6 billion.

Bitcoin and virtual currencies like it, known in the investment community as fiat money – tender unrecognised by any government but widely accepted as currency – can sometimes – by intent or inadvertently – result in transactions where no tax is paid.

The IRS began looking at the impact virtual currencies could have on the body’s ability to properly ensure tax compliance in 2007. Though since then has it not kept up with these currencies’ rate of development and could have done more to prevent virtual currency operators from slipping through the cracks, or so says the Government Accountability Office (GAO), which recently published a report on the subject.

As well as providing a critique of the IRS’ handling of virtual currency operators, the office also suggested that integrating virtual currencies and doing business through virtual economies is possible, and can produce taxable income. It also included a caveat however, warning of the dangers posed by “closed flow” transactions: a closed flow is where a buyer purchases an online-based product or service – a film or television streaming subscription or social media game tokens for example – and no real world money or products or services change hands.

Although Bitcoin is viewed by many online spenders as a new and exciting online payment option, and is lauded by its pioneers as a currency of the future, it also has its detractors, and is vulnerable to the ebb and flow of global money markets – another reason regulators are keen to bring the phenomenon under their umbrella. Bitcoin’s valuation hit a sharp incline around March, when the global financial crisis, particularly developments in Europe, saw the value of a Bitcoin – priced at around $19 in January, jump to $190 in April. At present (June 10), one Bitcoin is valued at $121.

The episode attracted a wide range of attention from authorities, including the Federal Reserve, which at the beginning of June announced that it is investigating the risks virtual currencies and online payment facilitators – including Bitcoin and PayPal – could have on global financial markets.

“We have been taking with banking organisations over the last year or two, trying to more carefully understand what the concerns are with these new payment mechanisms,” Agence-France Presse quotes Federal Reserve vice chair Janet Yellen as saying.

Lawmakers are expected to reveal more about their plans to engage virtual currency operators in the weeks ahead.