Icahn Raises Bid for XO to $0.80

October 26th, 2009 by · 7 Comments

In a filing this morning with the SEC, it emerged that Carl Icahn raised its bid for XO Holdings (news, filings) on Friday.  However, the offer expires today at 6pm Eastern. Yes, that's right - he gave them a whole weekend to think about it, and the company itself hasn't even issued a PR or made a filing on the subject.  Here is the text:

On October 23, 2009, ACF Industries Holding Corp. ("ACF Holding"), an entity wholly owned by Carl Icahn, the Chairman and holder of a majority of the outstanding Shares, sent a letter to the Special Committee (the "Special Committee") of the Board of Directors of the Issuer (the "ACF Holding Letter"), pursuant to which ACF Holding made a non-binding proposal to increase its previously outstanding offer to acquire all of the outstanding Shares which it does not own, to an aggregate of $0.80 net per share in cash. The prior offer, which was rejected by the Special Committee on September 28, 2009, was for an aggregate of $0.55 net per share in cash. Pursuant to the ACF Holding Letter, the current offer will expire at 6:00 pm (EST) on Monday, October 26, 2009.

Now, is $0.80 much better than $0.55 that "substantially undervalued" the company?  In an ideal world, it would not seem to be anywhere close.   But this is the alternative world of the independent special committee, who who really knows.

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Categories: CLEC · Mergers and Acquisitions

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7 Comments So Far


  • carlk says:

    I’d like to ask Jim Crowe a similar question about “value” or lack thereof in the case of (3). He doesn’t answer phone calls though! Their recent board appraisal at $1.50 pps for freebies is unimpressive compared to Crowe hype over a decade’s time. My ears are still stinging-permanently impaired- from his “multiples” more comment when comparing a then $14B market cap, while he was selling his irrevocable trust shares that became revocable later in order to assuage underlying owners after the mecca building had been done.

    Hopefully, in the xoho matter, Mr. Market will soon tell Icahn that he must pay even more, otherwise, some other player will!

  • thewanderer says:

    And now for our next act, master ventriloquist Carl Icahn and his little wooden buddy who he likes to call the independent special committee…

  • Dave Rusin says:

    What a distraction for XO employees …

    • Rob Powell says:

      It’s been this way for far too long. It’s about time someone who like’s XO’s fiber assets more than its tax assets to buy it.

  • Dave Rusin says:

    Carl Icahn knows the value of the metro fiber … he’s not about to give anything away … he can afford to wait for Wall Street to figure it out as well.

    It’s sort of like Warren Buffet buying up pipelines in the early 80’s … lots of folks thought he was nuts. Pipes are always needed to get whatever runs in them from point A to point B. Pipes are costly to build but have a long life and are hard assets.

  • carlk says:

    Mr. Rusin, Isn’t the point more about Carl Icahn, the iconic shareholder activist, one who forces management teams across all public market sectors, to unleash unrecognized, true values on behalf of all shareholders, that he do the same for his “minority shareholders” whom he is attempting to steal the company from in order to benefit his stingy, one sided self, only, today?

    Where are those cnbc clowns on this? CRAMER! NO WAY! Get me Gasparino!

  • Dave Rusin says:

    Sure Icahn plays the financial game but he has two things most people don’t to realize value … lots of cash and time/patience.

    He knows the value of the metro assets and will play this nickel/dime game forever or until someone else makes XO (Icahn) an offer he likes for his shares of XO … he is in no hurry.

    Proof is in the pudding — rumored months ago on this web site several carriers approached Icahn about buying XO — did he sell? No. They are not distressed so bottom feeders can go away. And, asset-light companies can’t swing the debt to buy.

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