SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No.3)*
Commercial Metals Company
(Name of Issuer)
Common Stock, Par Value $0.01
(Title of Class of Securities)
201723103
(CUSIP Number)
Keith Schaitkin, Esq.
Icahn Capital LP
767 Fifth Avenue, 47th Floor
New York, New York 10153
(212) 702-4300
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
November 28, 2011
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Section 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box / /.
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
Item 1. Security and Issuer
This statement constitutes Amendment No. 3 to the Schedule 13D relating to
the Common Stock, par value $0.01 (the "Shares"), issued by Commercial Metals
Company (the "Issuer"), and hereby amends the Schedule 13D filed with the
Securities and Exchange Commission on July 28, 2011, as amended by Amendment No.
1 filed with the Securities and Exchange Commission on September 1, 2011 and
Amendment No. 2 filed with Securities and Exchange Commission on October 19,
2011 (together, the "Schedule 13D"), on behalf of the Reporting Persons (as
defined in the Schedule 13D), to furnish the additional information set forth
herein. All capitalized terms contained herein but not otherwise defined shall
have the meanings ascribed to such terms in the Schedule 13D.
Item 4. Purpose of Transaction.
Item 4 of the Schedule 13D is hereby amended by the addition of the
following:
On November 28, 2011, the Reporting Persons delivered a letter to the Board
of Directors of the Issuer. Pursuant to the letter, Icahn Enterprises offered to
acquire Commercial Metals Company at $15 per share without any financing or due
diligence conditions. The letter is incorporated herein and attached hereto as
Exhibit 1.
Item 7. Material to be Filed as Exhibits.
Exhibit 1 Letter to Board of Directors, dated November 28, 2011.
SIGNATURE
After reasonable inquiry and to the best of each of the undersigned
knowledge and belief, each of the undersigned certifies that the information set
forth in this statement is true, complete and correct.
Dated: November 28, 2011
ICAHN PARTNERS MASTER FUND LP
ICAHN PARTNERS MASTER FUND II LP
ICAHN PARTNERS MASTER FUND III LP
ICAHN OFFSHORE LP
ICAHN PARTNERS LP
ICAHN ONSHORE LP
BECKTON CORP.
HOPPER INVESTMENTS LLC
BARBERRY CORP.
HIGH RIVER LIMITED PARTNERSHIP
By: Hopper Investments LLC, general partner
By: /s/ Edward E. Mattner
------------------------
Name: Edward E. Mattner
Title: Authorized Signatory
ICAHN CAPITAL LP
By: IPH GP LLC, its general partner
By: Icahn Enterprises Holdings L.P., its sole member
By: Icahn Enterprises G.P. Inc., its general partner
IPH GP LLC
By: Icahn Enterprises Holdings L.P., its sole member
By: Icahn Enterprises G.P. Inc., its general partner
ICAHN ENTERPRISES HOLDINGS L.P.
By: Icahn Enterprises G.P. Inc., its general partner
ICAHN ENTERPRISES G.P. INC.
By: /s/ Dominick Ragone
--------------------
Name: Dominick Ragone
Title: Chief Financial Officer
/s/ Carl C. Icahn
--------------------
CARL C. ICAHN
[Signature Page of Schedule 13D Amendment No. 3 - Commercial Metals Company]
Exhibit 1
---------
CARL C. ICAHN
November 28, 2011
Board of Directors
Commercial Metals Company
6565 North MacArthur Boulevard, Suite 800
Irving, Texas 75039
Ladies and Gentlemen:
I am currently your largest shareholder and beneficially own 9.98% of the
outstanding common shares of Commercial Metals Company (the "Company") through
several affiliated entities, including subsidiaries of Icahn Enterprises LP
(NYSE: IEP). Based upon publicly available information, Icahn Enterprises (which
currently has, on a consolidated basis, $22.4 billion of assets, including in
excess of $13 billion in liquid assets, which are cash and marketable
securities) hereby proposes to purchase the Company in a merger transaction at
$15 per share without any financing or due diligence conditions. That price
represents a premium of 31% over the stock's closing price on November 25, 2011,
which was $11.45, and a premium of 72.6% from its low this year on October 3,
2011, which was $8.60.
IEP is prepared to proceed to immediately negotiate and execute definitive
documents. We firmly believe that the Board's fiduciary duties require the Board
to allow shareholders to decide for themselves if they wish to accept this
offer. Accordingly, we are also prepared to structure the transaction with an
immediate front end tender offer, with protections for minority shareholders
pending completion of the merger.
This transaction will allow shareholders the opportunity to monetize their
investment in the Company. Those who desire to stay invested in this industry
could take their proceeds and invest in direct competitors in the steel industry
which we believe are much better managed and better situated to take advantage
of any possible economic recovery than Commercial Metals.
The reason IEP is paying a 31% premium over the November 25, 2011 closing
price is because of IEP's ownership of PSC Metals Inc. When the acquisition is
completed IEP intends to combine Commercial Metals with IEP's own metals
recycling assets. IEP will sell Commercial Metals' non-core assets and
immediately appoint a new management team to run the steel business. In our
opinion, these undertakings are imperative to realize future profits at
Commercial Metals.
As a 10% shareholder of Commercial Metals we are extremely concerned about
the capabilities and behavior of the current Board and management, and
therefore, we intend to nominate three individuals as directors at the Company's
2012 annual meeting of shareholders, as well as make several proposals for
shareholder consideration. We do not believe the current Board is capable or
willing to undertake the actions necessary to enable Commercial Metals to
compete in the future. Such actions include, but are not limited to, the sale of
non-core assets, the immediate replacement of management, and the refocusing of
the business on core operations in North America. The track record established
by the current Board and management team over the last several years is dismal.
Unfortunately, a below average operating performance fueled by a distracting and
misguided international growth plan, combined with a disastrous investment
record, has become the defining characteristic of Commercial Metals. We have no
confidence in management's ability to continue running the Company, nor do we
have any confidence that the Board will ever hold management accountable for
poor performance - as shown by the recent and inexplicable bonuses paid to
management. But, hopefully,even this Board will finally take its fiduciary duty
to shareholders seriously enough to allow shareholders to decide whether or not
to sell the Company at a 31% premium over current market price.
Your management team has suggested a recovery in key end markets will not
materialize in 2012. Further, in our opinion, because the Company has been so
poorly managed, shareholders are exposed not only to cyclical industry risks,
but also to permanent risks. Astoundingly, between 2006 and 2011, the Company
squandered $2 billion of capital on ill-conceived acquisitions and "growth"
projects, many of which generated negative EBITDA through the period.
Despite this dismal record, the Board recently granted bonuses to
management, including a $750,000 bonus to the new CEO -- for what exactly?! Not
in recognition of the Company's operating performance, but because management
threw in the towel and admitted that the Company should walk away from many of
the substantial investments that you approved only a few years earlier. The
logic is absurd! The Company spends shareholder money on disastrous investments,
and then several years later, awards management special bonuses - again
shareholder money - for having the "courage" to run away from those very same
investments!
Unfortunately, over the next several years even if the steel markets shift
into a cyclical recovery, we fear, and believe, that Commercial Metals will
simply shift back from the current strategy where management is supposedly
focused on unwinding its disastrous investments, to the previous "strategy",
where management travels the world investing in losing "growth" projects from
Croatia to Australia.
In light of the above, we again ask you to finally show that even this
Board is serious enough about its fiduciary obligations to allow shareholders,
and not themselves, to decide whether to sell the Company at a substantial
premium over the current market price. We would like to move forward immediately
and we are ready to meet. We are prepared to enter immediate negotiations and
would like to see a tender offer launched as soon as possible.
Carl C. Icahn