Activist investor Carl Icahn has late Tuesday withdrawn his offer to buy the remaining shares in oil refiner CVR Energy, Inc. (CVI: Quote) as he does not currently deem the proposed deal as feasible. The billionaire had offered to take CVR Energy private for $29 per share in early August, while also earlier launching a proxy fight to seat his slate of directors.
The move came after Icahn failed to find buyers for CVR Energy following his accumulation of 82 percent of CVR Energy since a $29 per share tender offer was floated in May.
He did not manage to get any creditable offer after contacting at least 30 potential buyers, including Western Refining, Inc. (WNR), HollyFrontier Corp. (HFC), Tesoro Corp. (TSO), Valero Energy Corp. (VLO), Marathon Petroleum Corp. (MPC) or ConocoPhilips (COP).
While making his hostile offer, Icahn had promised shareholders to sell the company to a higher bidder for at least $37 per share.
After he secured 69 percent stake in the company, Icahn raised his offer to $30 per share in order to pull in the rest of the shares into the offer, but failed to reach the threshold of 90 percent that would have allowed Icahn to merge CVR Energy with one of his affiliates.
In a regulatory filing with the U.S. Securities and Exchange Commission, Icahn Enterprises L.P. (IEP: Quote) said it is withdrawing the offer to take CVR Energy private for $29 per share as "a number of market conditions have changed, including a significant widening of crack spreads."
However, Icahn had said earlier that he will in no event consider paying more than $30 per share for the energy company.
In mid-March, CVR Energy inked a deal with Carl Icahn that annulled the "poison pill" provision and allowed the activist investor to complete a $30 per share tender offer.
About 55 percent of CVR Energy shares were tendered under the offer that lapsed on April 2, but Icahn was not able to buy as it would trigger the poison pill clause.
However, CVR Energy continued not to recommend the offer to its shareholders and believed the company's potential long-term value exceeds $30 per share.
Icahn launched a hostile bid for CVR Energy offering at $30 per share in February after CVR Energy adopted stockholder rights plan or poison pill, in January when Icahn increased his stake in the company to 14.5 percent.
Icahn's offer withdrawal comes months after hostile bids for cleaning products company Clorox Co. (CLX), and Commercial Metals Co. (CMC) ended in failure due to lack of shareholders support.
CVI closed Tuesday's regular trading session at $29.55, down $0.02 or 0.07% on a volume of 0.28 million shares, while IEP closed at $40.79, up $0.39 or 0.98% on a volume of 3,596 shares.
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by RTT Staff Writer
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