Activist investor Carl Icahn defended his tender offer of CVR
Energy Inc. (CVI) in a letter Friday, saying his offer is a
"win-win" for shareholders and reiterated his intention to nominate
board members that would push for a sale of the petroleum refining
and marketing company.
Shares rose by 3.6% to $26.93 in recent trading.
Icahn last month commenced a tender offer of CVR valued at $30 a
share, ramping up pressure on the company to put itself on the
block. Icahn is the company's largest shareholder with a roughly
15% stake.
Icahn said he will drop the proxy fight if less than 36% of
CVR's outstanding stock is tendered by March 23 but he said he
believes he will receive tenders of more than 36%.
Icahn also said in his letter the potential buyers he has spoken
with are not prepared to acquire the company at this time, but said
he would nominate directors who would conduct a full and open
process to sell the company.
Under Icahn's offer, shareholders would also receive a
contingent-value right that would entitle them to an additional
payment if the company is sold for more than $30 a share,
corresponding to the amount over that level.
Last week, CVR's board unanimously called on its shareholders to
reject Icahn's hostile $2.6 billion tender offer, calling the bid
"a paltry premium" that substantially undervalues the company.
Friday, Icahn said CVR's letter made statements that he
considers "disingenuous and misleading."
Icahn has said the refiner has a value of at least $37 a share,
adding that he believes rivals such as Western Refining Inc. (WNR),
Valero Energy Corp. (VLO) and Marathon Petroleum Corp. (MPC) would
be interested in CVR Energy's refineries.
CVR reported last week its fourth-quarter earnings surged on a
favorable derivatives impact, though its main business was hurt by
sharply higher turnaround expenses and lower sales.
-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287;
nathalie.tadena@dowjones.com