Clorox says no to Icahn's $10.2B buyout bid

AP News
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Posted: Jul 18, 2011 7:21 PM
Clorox says no to Icahn's $10.2B buyout bid

Clorox Co. said Monday it is rejecting as too low an offer for the company from billionaire investor Carl Icahn that values the consumer product maker at $10.2 billion.

The Oakland, Calif., company also said it is adopting a "poison pill" shareholder rights measure to ward off he bid from Icahn, Clorox's largest shareholder. The company said it is committed to its current strategy, saying its own plans are the best way to create value for its shareholders.

On Friday, Icahn Enterprises LP offered to buy the outstanding shares of Clorox for $76.50 apiece. Rather than urge the company to take the unsolicited offer, Icahn said Clorox should shop itself to competitors, saying it could get a better offer from U.S. competitors like Procter & Gamble, Colgate-Palmolive Co., and Kimberly-Clark Corp., or from overseas rivals like Unilever PLC, Reckitt Benckiser and Henkel AG.

A spokeswoman for Icahn said late Monday that he was unavailable to comment on Clorox's response.

Analysts were uncertain a competitor would want to acquire Clorox, which does most of its business in the mature U.S. markets and is not a big player in faster-growing overseas markets.

The stockholder rights plan will take effect if a person or group acquires a 10-percent stake in Clorox in a transaction not approved by the board. If that happens, the company will issue one stock purchase right for each share outstanding as of July 28.

Icahn bought a 9.4 percent stake in Clorox in December.

Shares of Clorox fell $1.51, or 2 percent, to close Monday at $73.04. They recovered a penny in aftermarket trading.