USX Puts Off Reply to Icahn’s Bid : Investor Again Increases Stake--to 11.4% From 9.83%

USX Corp. declined Tuesday to respond immediately to an $8-billion takeover bid from corporate raider Carl C. Icahn, indicating that it may wait as long as two weeks before giving the offer consideration.

Meanwhile, Icahn said Tuesday that he had raised his USX stake to 11.4% from the 9.83% that he disclosed Monday. He purchased slightly more than 4 million shares on Tuesday at $26.50 each. His original stake had been acquired at an average price of $21.52 per share.

In its only formal statement regarding the $31-per-share offer that Icahn made Monday, the giant steel and oil company said it would respond “at the appropriate time.” Since USX hired two investment banks on Sept. 22 and gave them 30 days to recommend a corporate restructuring, Icahn has said he would leave his offer open until Oct. 22.

In documents filed with the Securities and Exchange Commission and in interviews, Icahn said he proposed to make USX’s steel business profitable by negotiating union contracts that offer workers equity considerations or profit-sharing plans in return for wage and benefit cuts.

He said he would consider withdrawing his offer if USX management produced a plan to improve the value of the company’s stock, perhaps by selling off underperforming assets.

At United Steelworkers headquarters in Pittsburgh, Icahn’s offer was regarded with some skepticism.

Doubt About Icahn’s Plans

“It’s just bar talk as far as we’re concerned,” said Russ Gibbons, a spokesman for the union. Noting that Icahn has been regarded as less of an industrialist than as a stock investor interested in trading profits, Gibbons said: “He’s the last kind of guy in the country who wants to be a new steel man. He wants to make money.”

The union’s reaction reflected doubt about Icahn’s plans and motivation that spread throughout Wall Street as well. For it was only a month ago that USW officials all but welcomed an Icahn-style attack on the USX management, which has refused to bargain with the union since its 22,000 steelworkers struck USX on Aug. 1.

“Our view is that things are at such a terrible low point in our relations with management that any move for change would be in our favor,” union spokesman Gary Hubbard told The Times in September.

Steel industry analysts on Wall Street noted that pressure from Icahn might inspire USX, which was formerly known as U.S. Steel, to bargain with the union on the reasoning that a contract settlement resembling that won by USW units at other integrated steel companies would be so costly that it would drive Icahn away from the company.

But they also noted that USX Chairman and Chief Executive David M. Roderick has long been pursuing a corporate restructuring to pare some of the company’s heavy debt and further reduce its dependence on the steel industry, in part by diversifying into oil.

“I don’t interpret what Icahn said as a criticism of the management’s direction, just of its speed,” said Andrew Gray III, steel industry analyst for the Pershing & Co. unit of Donaldson, Lufkin & Jenrette.

Some questioned Icahn’s resolve to acquire USX, which is expected to lose almost $500 million this year. “Just by talking about offering $31 a share, he’s boosted the value of his holdings by about $40 million,” remarked Robert A. Hageman, steel industry analyst for Kidder, Peabody & Co.

Outlook for Profits

The prospects for profits in USX’s steel business remain questionable. Gray predicted that the company would never reopen as much as a third of its 27 million tons of steelmaking capacity after the strike ends. “If they then eliminate 5,000 steelworkers,” he said, “that could eliminate $500 million in costs”--enough to make the steel operations profitable.

Hageman argued, however, that the company is saddled with such heavy potential pension costs that it paradoxically costs less to operate money-losing steel plants than to shut them down.

USX’s balance sheet shows $2.15 billion in non-current liabilities, most of which applies to pension obligations, that might become current liabilities if its plant shutdowns and layoffs brought the pension payments due.