Auto parts supplier Lear Corp. Accepts $2.8B Takeover Bid
This article is from the Channel 4 News- Detroit website.
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DETROIT — Auto parts supplier Lear Corp. said Friday that it has agreed to be acquired by a group affiliated with billionaire investor activist Carl Icahn for about $2.8 billion.Under terms of the deal, Icahn-controlled American Real Estate Partners LP is paying $36 a share, and a Lear spokesman said that amounts to about $2.8 billion. It also includes the assumption of about $2.5 billion in debt.That is more than $4 a share below its closing price of $40.07 on Thursday when takeover speculation drove Lear’s price higher.
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“Lear is an excellent company with a strong management team in place,” Icahn said in a statement. “We look forward to working with Lear’s team to improve its long-term competitiveness, capitalize on growth opportunities globally and to build an even stronger and more valuable company in the future.”Under the terms of the agreement, Southfield-based Lear may solicit alternative proposals for 45 days from the execution of the agreement and intends to consider any such proposals. Lear also may, at any time, respond to unsolicited proposals. If Lear accepts another proposal, a break-up fee would be payable to AREP.Otherwise, the company said the deal is expected to close by the end of the second quarter. The agreement is subject to the approval of a majority of Lear shareholders, regulatory filings and other customary approvals.”We believe that the transaction price, which represents a multiple of about 9 times our forecasted 2007 core operating earnings — excluding the interior business, provides shareholders with significant value,” said Bob Rossiter, Lear’s chairman and chief executive.The offer had been made public Monday.
