CVR Energy Inc. today sent a letter to shareholders as a deadline for them to tender into an offer by Carl Icahn looms.
May 3, 2012
Dear Fellow Stockholders,
As you know, Carl Icahn’s tender offer to acquire all outstanding shares of our common stock for $30 per share in cash plus a contingent cash payment right ("CCP") expires at 11:59 p.m. New York City time tomorrow evening. As was disclosed in the company’s Solicitation / Recommendation Statement on Schedule 14D-9, CVR Energy’s Board of Directors is not recommending that stockholders tender their shares into Mr. Icahn’s offer because it believes that the company’s potential long-term value exceeds the tender offer price.
We are writing to let you know what happens next if Mr. Icahn either does or does not succeed in his tender offer. If at least 31,661,040 shares (which represents approximately 36 percent of the outstanding shares) are tendered prior to 11:59 p.m. tomorrow night, the Minimum Condition will have been satisfied. This means that the tendered shares plus the number of shares already owned by Mr. Icahn represent a majority of our outstanding shares.
If the Minimum Condition is Satisfied: In accordance with the Transaction Agreement previously entered into between the company and the Icahn Group, if the Minimum Condition and all other applicable conditions are satisfied, then:
- Completion of the initial offering period: Mr. Icahn is required to close the tender offer and accept all tendered shares for payment.
- Additional tender period: Mr. Icahn is then required to immediately provide all remaining stockholders not wishing to remain minority stockholders in a controlled company with an additional 10-business day period during which they may tender any remaining outstanding shares for the same $30 in cash plus a contingent cash payment right (the Subsequent Offering Period). During the Subsequent Offering Period, Mr. Icahn must immediately accept for payment and promptly pay for all shares tendered on an ongoing basis.
- Short-form merger: If either at the conclusion of the initial tender period or the conclusion of the Subsequent Offering Period, the Icahn Group holds 90% or more of the outstanding shares, Mr. Icahn must cause a merger to take place in which all remaining outstanding shares will be converted into the right to receive the same consideration as in the tender offer ($30 per share in cash plus a CCP), unless such holder chooses to exercise statutory appraisal rights.
- Untendered shares may remain outstanding: If the Icahn Group does not hold 90 percent or more of the outstanding shares at the conclusion of the Subsequent Offering Period, those shares which have not been tendered will remain outstanding.
If the Minimum Condition is Not Satisfied: If Mr. Icahn does not receive the required level of stockholder support as of 11:59 pm New York City time on May 4, pursuant to the Transaction Agreement he has agreed to terminate his tender offer and the pending proxy contest for control of our Board of Directors.
For additional detail regarding the foregoing mechanics and to review the complete recommendation of your Board of Directors, please refer to our Solicitation/Recommendation Statement on Schedule 14D-9 (as amended) on file with the Securities and Exchange Commission (and available free of charge at www.sec.gov), available on the company’s website www.cvrenergy.com through the Investor Relations link, and previously mailed to all stockholders.
As described in the company’s prior communications, the company and its advisors have contacted possible acquirers to determine their level of interest in a potential transaction with the company. If Mr. Icahn’s tender off