December 07, 2015
When Bridgestone announced in October that it would buy Philadelphia-based auto service shop Pep Boys for $835 million, it seemed that the deal was done.
A billionaire investor, however, has stepped in and made everything a lot more complicated.
Carl Icahn, the titanic investor known for, among other things, trying to acquire the Trump Taj Mahal in Atlantic City from bankruptcy court, offered on Monday to buy Pep Boys himself, reported the Wall Street Journal.
He offered $15.50 a share, beating Bridgestone's deal of $15 a share. Icahn controls Auto Plus, another service-center chain, so buying up Pep Boys could help him absorb some competition.
Icahn disclosed on Friday that he had bought around 12 percent of Pep Boys' shares, Philly.com reported. Pep Boys had snubbed him before, when he offered to buy the company for $13.50 a share.
After the disclosure, the company wrote that it was afraid that Icahn was trying to "obtain negotiating leverage" to purchase Pep Boys' retail business, and it was right.
"Pep Boys shareholders’ ability to realize the value presented by the Bridgestone offer may be frustrated" as a result, Pep Boys said in a statement.
A Pep Boys representative could not be reached for comment.