Icahn Enterprises Holdings LP (IEP) released an open letter to shareholders and the Board of Directors of Irving, Texas-based Commercial Metals Company (CMC) on Wednesday regarding Icahn's tender offer to acquire CMC.
IEP wrote it believes CMC is "once again obfuscating the issues in their press release dated January 3, 2012." CMC sent a letter to shareholders Tuesday calling IEP's offer to acquire CMC at $15.00 per share opportunistic and urged them not to tender their shares or elect Icahn's Directors to the CMC Board.
"The question you, the shareholders, have to ask yourselves is whether you believe the Company is worth more than $15 per share with this Board and management team executing their announced strategy? We certainly do not want to leave our investment at their mercy in light of the Company's past performance, which we believe has been egregious," the letter continued.
IEP also made a new offer to CMC and its shareholders in Wednesday's letter: "because the Board believes that the stock is worth more than $15 per share, we hereby make the following offer to the Company: If 40.1 percent of the shares of the Company are tendered into our Tender Offer (giving us more than 50 percent of Commercial Metals stock)...then, if the Board agrees to put the Company up for sale, and in order to avoid a distracting proxy fight, we will extend the Tender Offer to allow the Company to conduct a fair sale process in which our Tender Offer would provide a $15 floor."
The letter went on to say that "[CMC is] asking shareholders to give them yet another chance to risk shareholder money on their global expansion plans. This is not the Boy Scouts." Icahn also reiterated that if at least 40.1 percent of CMC are not tendered, IEP will withdraw "our proxy fight so that we can be free to do as we like with our investment."
CMC stock has been on the rise ever since Icahn announced his interest in acquiring CMC in full in late November. The day before Icahn said he would launch a tender offer, November 25, CMC shares closed at $11.45. CMC shares closed at $14.45 on Wednesday--nearing Icahn's $15.00 per share offer price.