Icahn Offers Oshkosh a Devil’s Deal

Carl Icahn offered to buy all outstanding shares of Oshkosh (NYSE:OSK) for $32.50 per share, or a total of $3 billion, on Thursday, raising the stock to its highest in more than a year. Icahn is the company’s largest shareholder with a 9.45 percent stake, but has been something of an activist investor, previously nominating his own board of directors that was eventually rejected. His condition on the latest offer, which prices the shares at a 21-percent premium on the company’s Wednesday closing price, is that shareholders elect his choice of directors to the board.

Profit at Oshkosh has fallen 36 percent in the first three quarters of its current fiscal year. It posted a 66 percent drop in net income last year with the end of the war in Iraq and the planned troop withdrawal from Afghanistan.

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“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 a statement. “Oshkosh 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.”

He added that his offer would expire within 45 days, but would be extended if he was able to get at least 25 percent of the company’s outstanding shares. Oshkosh asked shareholders not to act on the offer until the company’s board has reviewed it, and said it would make its position clear within 10 business days.

Icahn, a billionaire, is known for taking large stakes in companies and pushing for management shake-ups. He is also the third-largest shareholder of Navistar International (NYSE:NAV), another trucking company, and proposed a merger between the two last year. Navistar’s former chief executive Daniel Ustian supported the suggestion, but Oshkosh opposed it.

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