Carl Icahn's American Railcar bids for rival Greenbrier for $543 mn
19 December 2012
US business magnate Carl Icahn's American Railcar Industries Inc, maker of hopper and tank railcars, has revived its plans to takeover larger rival Greenbrier Companies Inc for approximately $543 million, after a failed attempt for a merger between the two railcar builders in 2008.
American Railcar has offered $20 a share for the Oregon-based Greenbrier, 5-per cent above Monday's closing price of $18.97 on the New York Stock Exchange, according to a filing with the Securities and Exchange Commission Tuesday.
Icahn bought 10 per cent of Greenbrier last month, which made him the company's largest shareholder. He said that the stock was undervalued and also expressed his intentions to hold talks with Greenbrier on its strategic opportunities.
Further to the announcement of a potential deal, shares in Greenbrier shot up 7.4 per cent to $20.37 yesterday in New York. The stock has risen 46 per cent since Icahn bought the 10-per cent stake in November. Nevertheless, the offer price is well below the stock's 52-week high of around $26 attained in January.
American Railcar shares also surged 6.6 per cent to close at $34.36 yesterday on Nasdaq.
It's the billionaire investor's second attempt to take control of Greenbrier. In 2008, Icahn bought a 9.45-per cent stake in the company and tried unsuccessfully to merge it with American Railcar.