NEW YORK (AP) -- Activist investor Carl Icahn has offered to buy software maker Mentor Graphics Corp. for $17 per share in cash, or about $1.9 billion, according to a company regulatory filing on Tuesday.
Mentor makes software and systems used to test electronics components used in aerospace and military-grade products, automobiles and low-power electronics.
The offer is a 17 percent premium over the Wilsonville, Oregon, company's closing price last Friday. Its shares rose $1.74, or 12 percent, to $16.26 in morning trading during Tuesday.
The billionaire investor's offer leaves room for Mentor Graphics to receive even higher bids without paying him a break-up fee, according to the filing.
"We believe that our fellow shareholders should have the opportunity to accept our offer or a higher one, if one emerges as we think it will," he wrote in a note dated Tuesday to the company's board of directors and included in its filing.
Icahn met with Mentor Graphics last week to discuss putting the company up for sale, according to an earlier filing. At the time, Icahn argued that a sale would greatly enhance shareholder value and that several buyers would be interested in paying a "substantial" premium for it.
Icahn's offer assumes that Mentor Graphics will waive a shareholder rights plan, or so-called "poison pill," to protect the company from unsolicited takeover bids.
The disclosure of the Icahn bid for Mentor comes only four days after his $665 million offer for the Texas power company Dynegy Inc. failed to get sufficient support from Dynegy shareholders and was terminated.
Mentor makes software and systems used to test electronics components used in aerospace and military-grade products, automobiles and low-power electronics.
The offer is a 17 percent premium over the Wilsonville, Oregon, company's closing price last Friday. Its shares rose $1.74, or 12 percent, to $16.26 in morning trading during Tuesday.
The billionaire investor's offer leaves room for Mentor Graphics to receive even higher bids without paying him a break-up fee, according to the filing.
"We believe that our fellow shareholders should have the opportunity to accept our offer or a higher one, if one emerges as we think it will," he wrote in a note dated Tuesday to the company's board of directors and included in its filing.
Icahn met with Mentor Graphics last week to discuss putting the company up for sale, according to an earlier filing. At the time, Icahn argued that a sale would greatly enhance shareholder value and that several buyers would be interested in paying a "substantial" premium for it.
Icahn's offer assumes that Mentor Graphics will waive a shareholder rights plan, or so-called "poison pill," to protect the company from unsolicited takeover bids.
The disclosure of the Icahn bid for Mentor comes only four days after his $665 million offer for the Texas power company Dynegy Inc. failed to get sufficient support from Dynegy shareholders and was terminated.