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07/17/2007Shareholders nix Icahn bidWILMINGTON, Del. (AP) — Lear Corp. shareholders rejected a $2.9 billion buyout offer Monday from a firm led by billionaire investor Carl Icahn, mounting enough opposition amid concerns that the proposal undervalued the auto supplier. Icahn's American Real Estate Partners LP had improved its offer in the past week to $37.25 a share, but some shareholders said it was worth far more and questioned whether it was in their best interest. "It's a clear message to the management that the company belongs to its shareholders, not to you,” said Richard Pzena, the head of the second-largest shareholder who rallied opposition to the deal. Lear Chief Executive Officer Robert Rossiter said the company's leaders felt "in our hearts that we did the absolute best job for our shareholders” but the decision had "not changed anything that Lear will do, has done or will ever do.” Icahn, the company's largest shareholder with about 16 percent ownership, did not attend the meeting and it was unclear how he would proceed. Vincent Intrieri, senior managing director with Icahn Partners, said the firm respected the shareholders' decision. Icahn's group still is entitled to $12.5 million in cash and 335,570 shares of Lear common stock, under an agreement reached before the vote. The company also agreed to increase the Icahn group's share ownership limitation from 24 percent to 27 percent of the company's outstanding common stock. Shares of Lear dropped sharply following the news but quickly recovered its value, trading at $36.88, down two cents. The proposed sale would have paired another private equity firm with an auto supplier at a time of major restructuring within Detroit's auto industry. Lear operates a parts plant along Woodmere Avenue that employs approximately 109 workers, company spokeswoman Andrea Puchalsky said. A larger Lear plant along South Airport Road closed in July of 2004 idling about 300 workers.
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