Billionaire activist investor Carl Icahn says he will drop offer to buy Oshkosh if less than 25% of shares are tendered by week of Dec. 2

Nevin Barich

WASHINGTON , November 30, 2012 (Bloomberg LP) – Billionaire activist investor Carl Icahn said he will drop his offer to buy Oshkosh Corp. if less than 25 percent of shares are tendered by next week.

His offer to buy all outstanding shares of the Oshkosh, Wisconsin-based truckmaker at $32.50 a share, or about $3 billion, is set to expire at midnight Dec. 3.

If at least a quarter of shares are tendered, “we intend to continue our proxy fight and extend the expiration date of the offer until Oshkosh holds its upcoming annual shareholder meeting,” Icahn said in a statement today. Otherwise, “we will respect the shareholders’ wishes, drop our tender offer and proxy fight and move on to other endeavors.”

The statement didn’t say how many shares have been tendered so far.

Oshkosh encourages shareholders “to ignore Carl Icahn’s last minute plea to support his highly conditional, inadequate and opportunistic offer,” the company said today in a statement.

“Mr. Icahn continues to pursue flawed and ever-changing platforms, devoid of credible ideas or analysis,” according to the statement.

Oshkosh, the U.S. military’s leading supplier of medium-and heavy-duty trucks, fell 2.32 percent to $30.69 at 12:02 p.m. in New York. The shares are up 44 percent this year.

‘STRONG SIGNAL’

Icahn, 76, is the Oshkosh’s largest shareholder with a 9.5 percent stake. He announced his offer to buy the company on Oct. 11. The board rejected the bid on Oct. 26 and urged shareholders to do the same. The annual meeting will be held in January.

Icahn wants to replace the firm’s 13-member board of directors with his own nominees. He has criticized Oshkosh’s executives for poor performance and led an unsuccessful proxy fight earlier this year.

In his letter, the billionaire said he’s not asking shareholders to make a decision on selling their stock at this time, only “to support an extension of the offer and to send a strong signal to the Board and management team at Oshkosh.”

While Icahn said he believes Oshkosh has made some concessions in response to his offer, such as outlining a stock repurchase program, they’re “too little, too late,” he wrote.

Icahn has said he wants to spin off the company’s JLG unit, which makes construction lift equipment, because it is more valuable as a separate entity. Oshkosh bought the company in 2006.

“We believe that it is mandatory that JLG be separated from the remainder of the Oshkosh assets, something that the company apparently is not willing to do,” he wrote.

Walter Liptak, an analyst at Barrington Research Associates Inc. in Chicago, said he doesn’t believe JLG should be separated from Oshkosh. He has an outperform rating on Oshkosh.

“We believe that much of Carl Icahn’s premise for the spin-off of JLG is based on a short-term view of a cyclical company,” he wrote in a Nov. 27 note to clients. “The spin-off of JLG would destroy value rather than create it.”

--Editors: Stephanie Stoughton, Joe Winski

To contact the reporter on this story: Brendan McGarry in Washington at bmcgarry2@bloomberg.net

To contact the editor responsible for this story: Stephanie Stoughton at sstoughton@bloomberg.net

* All content is copyrighted by Industry Intelligence, or the original respective author or source. You may not recirculate, redistrubte or publish the analysis and presentation included in the service without Industry Intelligence's prior written consent. Please review our terms of use.