Activist investor, Carl Icahn, the owner of Icahn Enterprises LP and Icahn Capital LP hedge fund, has put forward a bid of $3 billion seeking to acquire Oshkosh Corporation (NYSE:OSK). Icahn is the majority shareholder at Oshkosh Corp, with approximately 9.5% holding, as per the June 30, SEC Form 13F filing, by the activist hedge fund.
Carl Icahn has been a key figure in major decisions made by the Wisconsin-based Automobile company, including a push for the separation of JLG industries, which it acquired in December 2006. Icahn was of the opinion that JLG had recovered enough to stand on its own and no longer need support from Oshkosh.
Clint Carlson's hedge fund, Carlson Capital's Double Black Diamond strategy, gained 1.04% net of fees in the month of September. Following this performance, the fund has returned 9.87% net of fees for the year to the end of the month. Q3 2021 hedge fund letters, conferences and more The Double Black Diamond strategy makes up Read More
Furthermore, Icahn has been noted to be a strong skeptic of the manner in which the management of Oshkosh Corporation (NYSE:OSK) has been running the military vehicle maker, claiming that it has failed to deliver pledges to improve profitability. Activist investors, are also known to be great value investors; Icahn is definitely one of them, and his intentions are to nominate directors for election to the board of Oshkosh at the company’s annual meeting, in a bid to steer change.
He is offering $32.50 per share, which is approximately 8.4% higher than the current price in the market. However, Icahn’s offer price was more than 21% higher than yesterday’s close, and the current price indicates investor reaction to the news of the deal. The company reported a 66% slump in earnings last year, following a decline in sales, as the company was led by CEO, Charles Szews.
Bloomberg quotes Icahn’s statement below, with regard to his overview on the performance of the management:
“Management has taken a passive attitude to the future of this company, willing to sit back and watch what happens to the defense, housing, and construction industries,” Icahn said in the statement. “Oshkosh Corporation (NYSE:OSK) needs proactive shareholders to bring a proactive management team together to weather a volatile economy, a shrinking defense industry, and a budget constrained municipal environment”.
Following the release of this statement, Oshkosh Corporation (NYSE:OSK) stock reached a high of $31.30 per share, but later slumped to trade at $29.97, up $3.12 per share, or 11.62% rise from yesterday’s close. The company’s most recent quarter reported increased revenues, which management attributed to have originated from construction equipment.
This is not the first time Icahn is involved in a change focused takeover, he has previously launched change campaigns in Navistar International Corp (NYSE:NAV) and Chesapeake Energy Corporation (NYSE:CHK), among others.