Lear Is Silent on Specifics of Trade Halt
U.S. auto parts maker Lear, which has received a $2.31 billion buyout offer from activist investor Carl Icahn, remained mum on the reasons behind a long trading halt in its shares Thursday.
The New York Stock Exchange halted trading in Lear shares at 10:41 a.m. EST. Trading did not resume. "The stock was halted because there is material news coming," Lear spokesman Mel Stephens said, declining to comment on the nature of the potential news.
Icahn, Lear's top shareholder, disclosed a offer cash offer of $36 per share earlier this week to buy the 84% of Lear shares he does not already own. The offer would be about $2.31 billion based on 76.3 million shares outstanding at the end of 2006.
Lear said at the time that Icahn's offer was subject to negotiation and board consideration. Senior management would remain in place after the takeover contemplated by Icahn.
Pzena Investment Management, Lear's second largest shareholder at about 7.48 million shares, opposed the Icahn offer and said Lear should be valued at closer to $60 per share. Pzena did not comment on the trading halt.
The stock has risen nearly 16% since the Icahn offer announcement on Monday, leading some analysts to speculate that Lear might command a higher price. It last traded at $40.06.
Icahn, who has said that Lear was set for a turnaround, raised his stake to nearly 12 million shares last year. Icahn Partners LP senior managing director Vince Intrieri was elected to Lear's board in November.
Lear reported a net loss of $707.5 million in 2006, reflecting troubles at its major customers -- the big Detroit automakers General Motors, Ford Motor and the Chrysler unit of DaimlerChrysler.