Icahn Enterprises to buy Dynegy for $665 mn

Dynegy, the third-largest US independent power producer, said its board unanimously approved a $665 million offer to be acquired by Icahn Enterprises after the company’s shareholders rejected an earlier, lower bid from Blackstone Group.

Icahn Enterprises’ offer of $5.50 a share represents a 10 per cent premium over Blackstone’s offer of $5 a share, Dynegy said in a statement today. The agreement also allows Dynegy to continue pursuing a better offer until January 24. Icahn has agreed not to oppose another buyer if Dynegy receives a higher bid.

Dynegy CEO Bruce A Williamson called the agreement, “a very positive outcome for all Dynegy stockholders” in the statement.

Carl Icahn and hedge fund Seneca Capital, Dynegy’s largest shareholders, opposed Blackstone’s offer to acquire the Houston-based company. A majority of Dynegy’s shareholders voted to reject the deal last month.

Icahn’s offer also will need shareholder approval. If he’s successful, the purchase will be Icahn’s largest in 10 years.