USX and Icahn in Talks on Takeover Bid, Restructuring

Corporate raider Carl C. Icahn and USX Corp. officials are holding preliminary discussions on the New York financier’s takeover bid and the company’s restructuring proposals, USX said Tuesday.

Meanwhile, USX Chairman David M. Roderick said a report initially expected today will be presented to USX officials “shortly” by the investment banking firms of Goldman, Sachs & Co. and First Boston Corp. on restructuring alternatives.

After management reviews the alternatives, it will then present its recommendations to the corporation’s board of directors, he said.

Earlier this month, Icahn made an $8-billion, $31-a-share takeover offer for USX, the former U.S. Steel Corp., which has become a major oil and gas producer while retaining its long-held position as the nation’s largest steelmaker.

Sources said Icahn is being informed of some of the restructuring proposals being examined by the company’s financial advisers. The talks also focus on Icahn’s desire to review the company’s books and the request by USX to have Icahn agree not to buy additional USX stock.

In confirming the talks with Icahn, the company said Tuesday that “USX has had discussions with Carl Icahn with respect to defining and clarifying his proposal, and such discussions are continuing.”

Initially, Wall Street had anticipated an announcement on a plan today since Roderick directed the study to be completed by that day. However, financial advisers have been discussing restructuring possibilities as they develop.

Financial advisers may need more than another week to finish the study. The USX board, however, has scheduled a regular meeting for next Tuesday, and there is some speculation that the issues could be presented at that time.

Sources said a variety of options have been reviewed, but no decisions have been made. They said an aspect of the review focuses on a number of ways to break up the company into business segments.

Analysts have speculated that the steel unit could be spun off, but sources said there have been no decisions on how or whether to break up the company.

Wall Street has speculated on the formation of a limited partnership to hold some of the energy assets.

USX, meanwhile, resumed negotiations today with the United Steelworkers, which has been picketing USX mills since a work stoppage began Aug. 1. “We thought it was in the best interest of both parties,” said a USX spokesman.

Sources said Icahn has had his own discussions with the union, which represents 22,000 USX members. There was speculation that those talks triggered the return to the bargaining table.