|Back to main|
Carl Icahn's Commercial Metals Stake Continues to Lose Shine
It has been about a year since activist investor
dropped his bid for Irving, Texas-based Commercial Metals Co. (
). After a proxy contest lasting several months, and the company
urging its shareholders to refuse Icahn's $15 per share tender
offer, Commercial Metals can continue to welcome the New Year
Icahn-free, as the takeover Guru reported his third stake
reduction in the company today.
Icahn, who once had about 10 percent control of the company, now has 6.17 percent of the company's outstanding shares. In the third quarter of 2012, he had 6.82 percent outstanding shares.
GuruFocus Real Time Picks reported that the transaction got rid of 9.43 percent of his stake, bringing his total shareholding to a little over 7 million shares, from his largest total of 11.5 million shares in the third quarter of 2011.
Icahn first acquired Commercial Metals in 2010, starting off with 2.4 million shares at the average price of $13.80, and quickly increasing in the quarters that followed. He had the goal of placing new members in the Commercial Metals board. But soon after Commercial Metals confirmed and showed reasons why Icahn's tender offer completely undervalued the company, Icahn backed away and reported his first stake reduction in the first quarter 2012.
Commercial Metals called the bid "opportunistic, [at a] low-ball price." The company also emphasized to its shareholders that Icahn's board nominees were not qualified, making sure to mention Icahn's past failed takeover attempts and how his current offer "creates an illusion for a meaningful premium."
"The company has made a number of promises to shareholders, which shareholders appear to believe will be beneficial to the stock," Icahn said in a statement. "We respect the views of the shareholders and hopefully their decision not to tender will prove to be the right one."
Icahn has lost at several high-profile proxy contests and takeover attempts. The most recent ones that made headlines were Greenbrier Companies Inc. ( GBX ) and Oshkosh Corp. ( OSK ).
Commercial Metals is down 1.15 percent this morning, trading at $15.40. It has 1 star in Business Predictability, 6 in Financial Strength and 4 in Profitability and Growth. (See the company's 10-Year Financials.)
View more of Icahn's latest trades here. Also view his undervalued stocks, top growth companies and high yield stocks.
About GuruFocus Real Time Picks
GuruFocus Real Time Picks alerts you of the stock purchases and sales that Gurus have made within the last two days. Follow your favorite Gurus closely with GuruFocus' Premium Membership. If you are not a Premium Member yet, we invite you to take advantage of our limited-time offer of 15% off our normal Premium Membership rate. Click on GuruFocus New Year Discount now! About GuruFocus: GuruFocus.com tracks the stocks picks and portfolio holdings of the world's best investors. This value investing site offers stock screeners and valuation tools. And publishes daily articles tracking the latest moves of the world's best investors. GuruFocus also provides promising stock ideas in 3 monthly newsletters sent to Premium Members .