Billionaire investor Carl Icahn on Wednesday dropped his $1.73 billion hostile bid for Commercial Metals Co
Shares of the company fell about 7 percent in before-the-bell trading. They closed at $14.76 Tuesday on the New York Stock Exchange. Icahn had offered $15 a share.
Icahn, who controls about 10 percent of the company, had hoped to secure support from investors holding another 40.1 percent of the company's shares. Only 23 percent of the shares were tendered in response to his offer, Icahn said.
The activist investor also withdrew his slate of nominees to the company's board.
The company has made a number of promises to shareholders, which shareholders appear to believe will be beneficial to the stock, Icahn said in a statement. We respect the views of the shareholders and hopefully their decision not to tender will prove to be the right one.
Icahn has lost out on a number of recent high-profile proxy contests and takeover attempts. Last year, he gave up on his years-long public campaign against Lions Gate Entertainment
Commercial Metals had dismissed Icahn's $15-a-share tender offer -- which represented a 31 percent premium when Icahn made his original approach in November -- as substantially undervalued and opportunistic. The stock briefly topped the $15 mark last week.
(Reporting by Michael Erman in New York and Swetha Gopinath in Bangalore; Editing by Saumyadeb Chakrabarty and John Wallace)