Icahn ups Lear offer to $37.25 from $36

SOUTHFIELD, Mich., July 9 (UPI) -- Carl Icahn's American Real Estate Partners LP increased its offer for U.S. auto supplier Lear Corp. to $37.25 a share from $36 a share, Lear said Monday.

The move comes after Icahn, Lear's largest shareholder, said he would not sweeten the $36-a-share offer.

"The Lear board concluded unanimously that the original merger agreement with AREP was fair and in the best interests of Lear's stockholders. The increased price makes the transaction even more attractive," said Larry McCurdy, Lear's lead independent director, in a statement.

Some large shareholders -- notably Pzena Investment Management, Lear's second-largest shareholder -- had criticized the $36 offer, saying it undervalued the Southfield, Mich., company.

Lear and Icahn argued the company still faced major risks as a North American supplier of automotive seats and electronic and electrical systems.

Lear said Monday it would file a revised proxy supplement with U.S. regulators and mail it to shareholders.

Shareholders will vote on the new bid next Monday. The vote had been scheduled for this Thursday.

If the shareholders do not approve the merger proposal, AREP would be entitled to a $12.5 million cash payment and 335,570 shares of Lear common stock, Lear said.