More reports on: M&A
Carl Icahn launches $2.6-bn bid for CVR Energy news
17 February 2012

Carl IcahnBillionaire activist-investor Carl Icahn has launched a $30 a share bid for CVR Energy, and demanded a change in the entire board of the crude oil refiner and fertilizer company.

Icahn's cash offer is a 9-per cent premium over CVR Energy's 15 February closing price on the New York Stock Exchange. CVR Energy shareholders also would receive a ''contingent-value right'' that would entitle them to additional cash if the company is sold for more than the $30 a share.

Sugar Land, Texas-based CVR Energy, which was taken public by Goldman Sachs in 2007, is currently valued at around $2.44 billion.

Icahn's offer values CVR Energy at $2.6 billion, but, said a sale of the company could fetch as much as $37 a share, a 34 per cent premium to the stock's 15 February closing price of $27.60.

Icahn, best known for investing in companies with an aim to make changes in the company's outlook and create more value for shareholders, holds a 14.5-per cent stake and is the largest shareholder in CVR Energy.

Undeterred by his failure to flush out rival bids for Clorox Co and Commercial Metals last year, Icahn had four days back urged Jack Lipinski, the CEO of CVR Energy to sell the company saying that the management was not doing enough to create value for shareholders.

Icahn named Western Refining, HollyFrontier, Tesoro Corp, Valero Energy, Marathon Petroleum, and ConocoPhillips as potential buyers for CVR Energy.

Icahn also intends to nominate nine directors to the company's board of directors at the next annual meeting and remove a so-called poison pill that the company had adopted last month to protect itself from the investor raising his shareholding further.

"We are launching this tender offer and proxy fight to provide shareholders the opportunity to obtain the value that we believe can be obtained in a sale of the company," Icahn said in a statement.

CVR owns refineries in Wynnewood, Oklahoma and Coffeyville, Kansas, that can process 185,000 barrels of crude a day. It also owns a majority interest in CVR Partners LP, which produces ammonia and urea ammonium nitrate.

CVR Energy said that it will review all of Icahn's actions and respond as appropriate in due course.

 





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Carl Icahn launches $2.6-bn bid for CVR Energy