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CVR Energy (CVI) Enters $30/Share Tender Offer Agreement with Icahn

April 19, 2012 7:06 AM EDT Send to a Friend
CVR Energy, Inc. (NYSE: CVI), a refiner and marketer of petroleum fuels and a majority owner of CVR Partners, LP (NYSE: UAN), a nitrogen fertilizer producer, today announced that it has signed a transaction agreement with Carl C. Icahn and certain entities under his control that would permit Mr. Icahn to complete his tender offer for $30 in cash per share plus a "contingent cash payment" right (CCP), if he obtains a majority of the shares. The agreement also provides important protections for CVR Energy stockholders. The Board initiated negotiations with Mr. Icahn after CVR Energy stockholders recently indicated their support for a near-term transaction at $30 per share plus the CCP.

The Board is not recommending that stockholders tender into Mr. Icahn's offer and continues to believe CVR Energy's potential long-term value exceeds $30 per share. But the Board also understands, based on the results of Mr. Icahn's tender offer on April 2, that many of the Company's stockholders may prefer to realize value in the near term and would consider the offer, as revised, an attractive near-term alternative. Accordingly, the Board has decided to permit CVR Energy stockholders to determine whether or not they wish to sell their shares at the price offered by Mr. Icahn.

If a majority of shares (taking into account those already owned by Mr. Icahn) are not tendered into his offer, Mr. Icahn will terminate his offer and his pending proxy contest for control of the CVR Energy Board of Directors.

Transaction Structure

The transaction agreement provides that:
  • Mr. Icahn will amend his existing tender offer within the next three business days to eliminate or reduce certain conditions to the offer and will extend the expiration date until 10 business days after the date of such amendment.

  • At the end of this 10-business day period, if the shares tendered into the revised offer represent more than a majority of the outstanding shares when added to those shares already owned by the Icahn entities (meaning approximately 36 percent of the company's outstanding shares tender into the offer), Mr. Icahn will be permitted to complete his offer.

  • If the offer is completed, Mr. Icahn has agreed to immediately provide a subsequent 10-business day offering period during which stockholders who did not initially tender but do not wish to be stockholders in the company after the change of control could tender any remaining outstanding shares for the same offer price plus the CCP.

  • If at any time Mr. Icahn owns 90% of the outstanding shares, he will complete a short-form merger under Delaware law pursuant to which all remaining outstanding shares will be cancelled in exchange for receiving the same per share consideration as paid in the tender offer plus the CCP.




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