Shares of Tenneco (TEN) - Get Tenneco Inc. Class A Voting Report jumped Monday after the auto parts maker said in a regulatory statement that activist investor Carl Icahn bought 3.48 million Tenneco Class A shares on April 1.
That purchase, made through Icahn Enterprises Holdings, would have cost $10.86 million at the close of trading April 1. Icahn already was the company’s top shareholder before that acquisition with a 9.9% stake.
Tenneco has suffered from the coronavirus pandemic, just like pretty much every manufacturing company. On Friday, it withdrew its first-quarter and full-year earnings guidance. It also suspended or reduced much of its operations.
“The continuing near-term deterioration in demand in our end markets necessitates further difficult decisions,” CEO Brian Kessler said in a statement.
In January, Dan Ninivaggi, who used to run Icahn Automotive Group and also is a shareholder in Tenneco through his Protean Services firm, urged the company to sell part or all of the company.
In a letter to Tenneco’s board, he demanded that half of the board be replaced. He also said Tenneco should raise cash to finance its debt by unloading its aftermarket-parts unit or by selling the entire company.
The next day, Tenneco dumped co-CEO Roger Wood and warned about having trouble executing its plan to split into two companies.
Icahn obtained his original stake in Tenneco when it purchased auto parts maker Federal-Mogul, which he controlled, in 2018.
At last check, Tenneco shares traded at $2.79, up 20.26%. The stock has plummeted 88% over the past 12 months, compared to a 10% decline for the S&P 500.