Activist investor Carl Icahn unleashed a $12.6 billion buyout bid for household products maker Clorox (NYSE:CLX) on Friday, putting the maker of Glad trash bags and Brita filters in play as a potential takeover target by a slew of rivals.
Oakland-based Clorox confirmed receiving the unsolicited bid from Icahn, which values the company at $76.50 a share, a 12% premium from its closing price on Thursday. Clorox said it will review the proposal in due course and while consulting with its financial and legal advisers.
Icahn, Cloroxs largest shareholder, already owns 9.4% of the company and said he has received a commitment for $7.8 billion in financing from Jefferies (NYSE:JEF). Icahn said he would also throw in $3.8 billion of cash on hand and $4.8 billion of equity contributions.
While an actual acquisition by Icahn is seen as unlikely, the move has succeeded at putting Clorox in play, setting up a potential bid from another company like Procter & Gamble (NYSE:PG), Colgate-Palmolive (NYSE:CL) or Unilever (NYSE:UN).
Indeed, Icahn encouraged Clorox to hold an open and friendly go-shop sale process to draw in potential suitors.
If the company does so, we are confident the process will result in numerous superior bids for this company, Icahn said in a letter to Clorox CEO Donald Knauss that was dated Thursday. "In our opinion, Clorox is simply too accretive for these potential Strategic Buyers to ignore."
Icahn also mentioned that Clorox resides in an industry that typically frowns upon "unfriendly" transactions.
Shareholders cheered the developments, bidding Cloroxs stock 10.68% higher to $68.43 ahead of the opening bell.
Clorox said Goldman Sachs (NYSE:GS) and JPMorgan Chase (NYSE:JPM) are serving as its financial advisers.