[Skadden, Arps, Slate, Meagher & Flom LLP Letterhead]
January 6, 2006
By FedEx and EDGAR
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Securities and Exchange Commission
100 F Street N.E.
Washington, D.C. 20549
Attn: Abby Adams, Esq.
Re: Fairmont Hotels & Resorts Inc. Schedule 14D-9
Filed on December 22, 2005
File No. 005-50486
Dear Ms. Adams:
On behalf of Fairmont Hotels & Resorts Inc., a corporation organized
under the laws of Canada (the "Company" or "Fairmont"), set forth below are the
Company's responses to the comments of the staff (the "Staff") of the
Securities and Exchange Commission (the "Commission") contained in your letter
dated December 29, 2005 (the "Comment Letter") with respect to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by the Company on
December 22, 2005 (the "Schedule 14D-9"). In connection with this response to
the Comment Letter, the Company is filing electronically with the Commission
today Amendment No. 2 (the "Amendment") to the Schedule 14D-9, as previously
amended by Amendment No. 1 filed by the Company on December 23, 2005.
The headings and numbered paragraphs of this letter correspond to the
headings and paragraph numbers contained in the Comment Letter. Capitalized
terms used but not defined in this letter shall have the meanings given to such
terms in the Schedule 14D-9.
SCHEDULE 14D-9
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1. TELL US WHAT CONSIDERATION FAIRMONT GAVE TO DISCLOSING THE INFORMATION
THAT FORMED THE BASIS FOR THE THREE FINANCIAL ADVISORS' OPINIONS.
COMPANY RESPONSE: In deciding whether to disclose the information
that formed the basis for the three financial advisors' opinions,
the Company considered all applicable disclosure requirements under
both Canadian and U.S. law. The Company noted that Schedule 14D-9
does not specifically require such disclosure and that such
disclosure is generally not provided either in Canada or the U.S.
in the context of tender offers such as
Abby Adams, Esq.
January 6, 2006
Page 2
the Icahn Offer. The Company does not believe that the nature of the
Icahn Offer or the Company's recommendation with respect thereto
would require disclosure of such information.
The Company also considered the requirement of Schedule 14D-9 to
provide the reasons for the Board of Directors' recommendation
regarding the Icahn Offer, for which the opinions of financial
advisors were one consideration. In that context, the Company
considered it appropriate to refer to and provide the entire text of
the three financial advisors' opinions in the Schedule 14D-9. While
the Company believes that the conclusions reached by the financial
advisors as set forth in their respective opinions are relevant to
shareholders, the Company does not believe that the disclosure of such
opinions, without more information, is misleading from the perspective
of the Company's shareholders. Opinions of this type reflect the
subjective judgment of a professional advisor and, as such, it is the
bottom line conclusion that is most critical to shareholders.
Furthermore, Fairmont believes that the disclosure of detailed
information about any analysis undertaken by its financial advisors
with respect to possible alternatives could be detrimental to the
Company's ongoing efforts to explore alternatives to the Icahn Offer.
In particular, the Board of Directors' and the Special Committee's
negotiating leverage in exploring a transaction with a third party and
maximizing shareholder value could be adversely affected if
information about the financial advisors' analysis were to be made
public. In addition, we note that the financial advisors did not
identify any particular item as forming the basis of their opinions.
In light of the foregoing, and after a review of the Schedule 14D-9 as
a whole, including the opinions of UBS Securities LLC, Avington
International and Scotia Capital Inc., which have been reprinted in
their entirety in the Schedule 14D-9 and the Amendment, the Company
believes that it has satisfied its Schedule 14D-9 obligation to
describe the reasons for the Board's recommendation and does not
believe that any additional disclosure is necessary.
2. PLEASE PROVIDE US ANNOTATED COPIES OF THE REPORTS CITED IN YOUR
DOCUMENT, INCLUDING THE TABLES ON PAGES 8 AND 10.
COMPANY RESPONSE: In response to the Staff's comment, we are
supplementally providing to the Staff annotated copies of the tables
on pages 8 and 10. The Company is not aware of any other similar items
in the Schedule 14D-9 subject to annotation. In addition, upon further
review of such information, we noted that in the table on page 8, the
figure relating to Global Hotel and Casino Unsolicited Take-over
Premiums, stated as 40%, should be revised to 39%. The Company has
revised Item 4 of the Schedule 14D-9 to reflect this change.
Abby Adams, Esq.
January 6, 2006
Page 3
THE ICAHN OFFER IS STRUCTURALLY COERCIVE, PAGE 9
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3. GIVEN THE DISCLOSURE HERE REGARDING THE CHOICES AVAILABLE TO SECURITY
HOLDERS, IT IS UNCLEAR WHY YOU REFER TO THE OFFER AS "COERCIVE."
ACCORDINGLY, PLEASE REVISE THE DOCUMENT TO REMOVE REFERENCES TO
"COERCIVE."
COMPANY RESPONSE: The Company believes that it is appropriate to
describe an offer as structurally coercive if it may have the effect
of pressuring shareholders into accepting the offer irrespective of
whether they believe that the offer is fair or adequate. The Company
further believes that the Icahn Offer fits that description because,
as a partial offer, it is designed, if successful, to give the bidder
a controlling stake in the Company, without any assurance as to the
timing or nature of any second-step transaction for the remainder of
the shares, or even if such transaction is to occur at all. This
creates a risk for shareholders that they may be left holding shares
as minority shareholders in a company controlled by a single entity,
possibly with a reduced value for the reasons discussed in the
Schedule 14D-9. In addition, even if a second-step transaction for the
remaining shares does occur, there is no assurance as to the terms of
any such transaction, including as to whether all shareholders will be
treated fairly and equally.
In light of the foregoing, shareholders, not knowing what others might
be doing, may feel compelled, given the structure of the Icahn Offer,
to tender their Shares to avoid being left as minority shareholders
and out of fear that their Shares might have a reduced value if the
Icahn Offer is successful for the reasons discussed in the Schedule
14D-9, and not because they think that the price for the Shares
offered in the Icahn Offer is fair or adequate.
Lastly, we note that the Schedule 14D-9 contains a description as to
why Fairmont believes that the Icahn Offer is coercive, which makes
clear to shareholders what is meant by the term and, as such, should
serve to address any concerns that the Staff may otherwise have had
with respect to the use of the term.
ICAHN IS SEEKING SHORT TERM PROFIT, PAGE 12
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4. PLEASE PROVIDE US SUPPORT FOR THE STATEMENTS IN POINTS 11 AND 12 ON A
SUPPLEMENTAL BASIS.
COMPANY RESPONSE: In response to the Staff's comment, with respect
to the statements in point 11, the Company supplementally advises
the Staff that the disclosure made in the Schedule 13D filing by
Icahn and related parties with the Commission on November 7, 2005,
stated that Icahn and related parties acquired the Shares because
"they believe that the Shares are undervalued in the market place"
and that their intent is to "encourage [the Company] to pursue
strategic alternatives. . . " In the Schedule 13D, Icahn and related
parties further noted, that such alternatives could include a sale
of the Company or a sale of certain assets of the Company with the
return of the proceeds of such sale to the Company's shareholders
through a dividend or a stock repurchase program. Icahn
Abby Adams, Esq.
January 6, 2006
Page 4
reiterated these statements in the subsequent Amendment to Schedule
13D and Schedule TO, filed with the Commission on December 9, 2005,
and the Amendment to Schedule 13D and Amendment to the Schedule TO,
filed with the Commission on December 27, 2005. In particular, we
refer you to the section discussing the purpose of the offer on page
4 of the Offering Circular, where the Icahn entities make clear their
intention to have a sale of the Company promptly effected, whether by
the existing directors or persons designated by the offerors.
To the Company's knowledge, Icahn has not been a shareholder of the
Company prior to August 24, 2005, and, as stated in the
above-referenced filings, Icahn acquired the Shares with a view of
pursuing a sale process. In light of the foregoing, the Company
believes it is reasonable in characterizing Icahn's actions as seeking
"an immediate short-term profit on Icahn's recent investment in
Fairmont."
With respect to the statement in point 12 that "with respect to a
number of other companies in which Icahn-affiliated entities have made
investments, Mr. Icahn has urged the company either to split up or
significantly increase its leverage, with the proceeds of such
leverage being paid to shareholders," the Company advises the Staff on
a supplemental basis, of the following prior situations.
In the course of their involvement with Kerr-McGee Corporation
("Kerr-McGee") in 2005, Icahn and related parties urged Kerr-McGee to
pursue a transaction in which Kerr-McGee would sell a portion of its
business, monetize forward production and distribute a stock dividend
to its shareholders, as disclosed in the Schedule 14A filed by Icahn
and related parties on March 3, 2005. Icahn, in a letter, also urged
Kerr-McGee to increase its share repurchase program. We also note that
Kerr-McGee, apparently to address the concerns of the Icahn related
entities, launched a self-tender offer for shares of its common stock,
which was financed by incurring debt, as described in the Schedule
TO-I filed by Kerr-McGee on April 18, 2005. It is our understanding
that the Icahn entities sold substantially all of their shares
pursuant to this offer.
Similarly, the Company notes that when Icahn and his related entities
recently surfaced with an investment in Time Warner Inc. they called
upon Time Warner to increase significantly its share repurchase
program and urged the company to spin off completely its cable-TV
division.
In addition, in connection with their involvement with Mylan
Laboratories Inc. ("Mylan"), Icahn and related parties pursued a sale
of Mylan, as disclosed in the Schedule 14A filed by Icahn and related
parties on November 19, 2004. We also note that Mylan, apparently in
reaction to the actions of Icahn related entities, launched a tender
offer for shares of its common stock, which was financed in part by
incurring debt, as described in the Schedule TO-I filed by Mylan on
June 16, 2005. It is our understanding that the Icahn entities sold
substantially all of their shares pursuant to this offer.
Abby Adams, Esq.
January 6, 2006
Page 5
We also note that in connection with running a slate of directors for
Blockbuster, Icahn suggested that Blockbuster consider issuing a
one-time extraordinary dividend to shareholders.
Lastly, we refer the Staff to USX and RJR Nabisco, where Icahn related
entities urged the respective companies to split up.
COMPLIANCE OF ICAHN OFFER WITH TAKE-OVER BID RULES, PAGE 13
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5. ON A SUPPLEMENTAL BASIS, PLEASE PROVIDE US YOUR DETAILED ANALYSIS IN
SUPPORT OF THE STATEMENT THAT, "IT WOULD APPEAR, BASED ON THE
DISCLOSURE IN THE ICAHN OFFER AND THE 13D FILING, BY VIRTUE OF THEIR
TERMS AND METHOD OF NEGOTIATION, THAT THE CALL OPTIONS MAY NOT FIT
WITHIN THE NORMAL COURSE EXEMPTION FOR THE [CANADIAN] PRE-BID
INTEGRATION RULES."
COMPANY RESPONSE: As discussed in the Schedule 14D-9, the "pre-bid
integration rules" contained in the Securities Act (Ontario) impose
limits on pre-bid purchases to ensure the equal treatment of all
shareholders where a take-over bid is made. The pre-bid integration
rules require, in part, that Icahn must offer to acquire under the
Icahn Offer the percentage of Shares that is at least equal to the
highest percentage that the number of Shares acquired from a seller in
a prior transaction (within 90 days of the Icahn Offer) was of the
total number of Shares owned by the seller at the time of the prior
transaction. In effect, the rule provides that, subject to limited
exceptions, an offeror may not make a partial bid if the offeror
voluntarily elected to accumulate shares prior to the bid and does so
on what are deemed to be more favorable terms by buying the full
position of any particular seller in the pre-bid market. The pre-bid
integration rules do not apply to trades effected in the normal course
on a published market so long as any broker acting for the purchaser
or seller does not provide services beyond customary broker's
functions and does not receive more than reasonable fees or
commissions. Solicitation restrictions also apply.
The Offering Circular indicates that Icahn used call options as well
as direct share purchases as part of its pre-bid acquisition program,
which occurred over the period between August 24, 2005 and November
29, 2005. Options were acquired over the period between October 19,
2005 and November 29, 2005. As best as the Company has been able to
determine, the options were not exchange traded options for Shares
but, in accordance with the disclosure in the Offering Circular, were
negotiated options purchased by Icahn from a specific broker who
acquired, or sold from his own account, the underlying Shares against
each of the options written and sold to Icahn. All of the call options
were then exercised on December 1, 2005.
The structuring of the options is complex and is described in detail
in Icahn's Schedule 13D filing. It would appear that the options were
written on a basis where there was almost no circumstance under which
the options would not be exercised due to the large upfront payments
made in connection with the purchase of the options. These options
Abby Adams, Esq.
January 6, 2006
Page 6
appear to have been specifically designed at the request of Icahn. It
is the Company's understanding, based on its review of publicly
available options trading data for the Company's common shares for the
period between October 19, 2005 and November 29, 2005, that the
purchase of these options was not reported on any published market.
We are advised by Canadian counsel to the Company that the pre-bid
accumulation program does not appear to have involved the kind of
normal course trading for which the limited exception was created in
applicable Canadian securities laws. Areas of concern include not only
the use of these specialized options but also the continuation of the
program after the filing of Icahn's Schedule 13D which sets out a
range of objectives of Icahn with respect to the Company. We are
advised by Canadian counsel to the Company that this would seem to run
counter to a staff notice of the Ontario Securities Commission in the
sense that after the filing of Icahn's Schedule 13D sellers of Shares
would have become aware of Icahn's intentions with respect to
Fairmont. This was material new information and it would be difficult
to argue that purchases of Shares by Icahn after the Schedule 13D
filing constituted "normal course unsolicited transactions." In the
interests of the shareholders of Fairmont and the fair and equal
treatment of those shareholders, Fairmont's Canadian counsel has
requested that the Ontario Securities Commission obtain further
information from Icahn to establish whether there has been compliance
with the pre-bid integration rules.
TRADING IN SECURITIES OF FAIRMONT, PAGE 15
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6. WE NOTE THAT, "PURSUANT TO A NORMAL COURSE ISSUER BID, FAIRMONT
PURCHASED AN AGGREGATE OF 2,526,700 SHARES BETWEEN JUNE 21, 2005 AND
DECEMBER 21, 2005 ...." PLEASE REVISE TO PROVIDE THE INFORMATION
REQUIRED BY ITEM 6 OF SCHEDULE 14D-9 WITH RESPECT TO THE COMPANY.
COMPANY RESPONSE: In response to the Staff's comment, the Company has
revised Item 6 of the Schedule 14D-9 to provide the requested
information with respect to Shares purchased during the 60 days prior
to the filing of the Schedule 14D-9.
CONSENTS OF FINANCIAL ADVISORS, PAGE 20
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7. WE NOTE THE DISCLAIMER IN THE LAST SENTENCE OF EACH CONSENT THAT THE
"[FINANCIAL ADVISOR DOES] NOT INTEND THAT ANY PERSONS OTHER THAN THE
SPECIAL COMMITTEE OR THE BOARD OF DIRECTORS RELY UPON SUCH OPINION."
WE ALSO NOTE THE DISCLAIMER IN THE LAST PARAGRAPH OF EACH OPINION. AS
THIS DISCLOSURE IS INCONSISTENT WITH THE DISCLOSURE OF THE OPINIONS IN
THE DOCUMENT, PLEASE REVISE EACH PARAGRAPH ON THIS PAGE AND EACH
OPINION INCLUDED WITH THE DOCUMENT TO ELIMINATE THESE DISCLAIMERS.
COMPANY RESPONSE: In response to the Staff's comment, the Company is
filing revised consents and opinions of each of UBS Securities LLC,
Avington International and Scotia Capital Inc.
Abby Adams, Esq.
January 6, 2006
Page 7
8. REVISE TO DISCLOSE THE MATERIAL TERMS OF THE COMPENSATION AND OTHER
ARRANGEMENTS WITH EACH FINANCIAL ADVISOR. SEE ITEM 1009(A) OF
REGULATION M-A.
COMPANY RESPONSE: In response to the Staff's comments, the Company
has revised Item 5 of the Schedule 14D-9 to provide the requested
information.
* * *
In addition, in response to the Staff's request, enclosed is an
acknowledgment letter from Terence P. Badour, Executive Vice President, Law and
Administration, of the Company.
* * *
Please feel free to telephone the undersigned at (212) 735-2218 or
Morris J. Kramer or Thomas W. Greenberg of this firm at (212) 735-2700 or (212)
735-7886, respectively, if you have any questions or need any additional
information.
Sincerely,
/s/ DAVID J. FRIEDMAN
------------------------
David J. Friedman
cc: Morris J. Kramer, Esq.
Thomas W. Greenberg, Esq.
Terence P. Badour, Esq.
G. Blair Cowper-Smith, Esq.
Phillip C. Moore, Esq.
[FAIRMONT HOTELS & RESORTS INC. LETTERHEAD]
January 6, 2006
BY EDGAR
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Abby Adams, Esq.
Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549
Re: Fairmont Hotels & Resorts Inc.
Schedule 14D-9
Filed on December 22, 2005
File No. 005-50486
--------------------------------
Dear Ms. Adams:
In response to the request of the staff (the "Staff") of the
Securities and Exchange Commission (the "Commission") set forth in the Staff's
letter sent December 29, 2005, Fairmont Hotels & Resorts Inc. (the "Company")
hereby acknowledges that:
(a) the Company is responsible for the adequacy and accuracy of
the disclosure in its filings with the Commission;
(b) Staff comments, or changes to disclosure in response to
Staff comments do not foreclose the Commission from taking
any action with respect to such filings; and
(c) the Company may not assert Staff comments as a defense in
any proceeding initiated by the Commission or any person
under the federal securities laws of the United States.
[Signature Page Follows]
Ms. Abby Adams, Esq.
January 6, 2006
Page 2 of 2
Fairmont Hotels & Resorts Inc.
By: /s/ Terence P. Badour
-----------------------------------
Name: Terence P. Badour
Title: Executive Vice President, Law
and Administration
cc: Morris J. Kramer, Esq.
David J. Friedman, Esq.
Thomas W. Greenberg, Esq.
G. Blair Cowper-Smith, Esq.
Phillip C. Moore, Esq.
Global Hostile Transactions ( > US$1 Billion) - January 1, 2000 to December 16, 2005(1)
- -------------------------------------------------------------------------------------------------------------------------------
Premium
Value of 20 trading days
Date Transaction prior to
Announced Target Name Acquiror Name (US$ mm) ann. date
- -------------------------------------------------------------------------------------------------------------------------------
12/5/2005 Guidant Corp Boston Scientific Corp $24,916 25.17%
12/2/2005 Fairmont Hotels & Resorts Inc Icahn Partners LP $1,186 14.03%
11/30/2005 General Maritime Corp FrontLine Ltd $1,364 5.51%
11/23/2005 Dofasco Inc Arcelor SA $4,219 50.15%
11/21/2005 NorthWestern Corp Black Hills Power Inc $1,280 17.49%
11/20/2005 Medicis Pharmaceutical Corp Mentor Corp $2,011 16.41%
11/14/2005 Inamed Corp Allergan Inc $2,995 15.84%
10/31/2005 Placer Dome Inc Barrick Gold Corp $9,348 19.80%
9/9/2005 Vincor International Inc Constellation Brands Inc $1,210 41.32%
9/5/2005 Endesa SA Gas Natural SDG SA $28,288 16.00%
8/22/2005 Patrick Corp Ltd Toll Holdings Ltd $3,098 10.39%
8/16/2005 Carter Holt Harvey Ltd Rank Group Ltd $1,142 3.73%
8/15/2005 London Stock Exchange PLC Macquarie Bank Ltd $2,586 15.99%
8/1/2005 Shurgard Storage Centers Inc Public Storage Inc $2,546 16.47%
7/17/2005 Maytag Corp Whirlpool Corp $2,654 38.52%
6/30/2005 NorthWestern Corp Montana Public Power Inc $2,001 12.26%
6/22/2005 Unocal Corp CNOOC $18,472 57.75%
6/20/2005 Maytag Corp Investor Group $1,275 3.96%
6/13/2005 Leica Geosystems AG Hexagon AB $1,075 62.22%
6/12/2005 HeidelbergCement AG Spohn Cement GmbH $3,341 25.00%
6/3/2005 Acxiom Corp ValueAct Capital Partners LP $2,274 28.27%
2/15/2005 Circuit City Stores Inc Highfields Capital Mgmt LP $3,119 19.55%
2/11/2005 MCI Inc Qwest Commun Intl Inc $9,743 54.56%
2/9/2005 Somerfield PLC Violet Acquisitions Ltd $1,792 26.68%
1/25/2005 Beverly Enterprises Inc Investor Group $1,512 41.13%
1/17/2005 Southcorp Ltd Fosters Group Ltd $2,025 15.32%
12/16/2004 Goldcorp Inc Glamis Gold Ltd $2,865 2.77%
12/13/2004 London Stock Exchange PLC Deutsche Boerse AG $2,625 33.83%
11/18/2004 Mylan Laboratories Inc Carl Icahn $4,990 17.65%
11/8/2004 General Property Trust Stockland $5,647 -0.18%
10/28/2004 WMC Resources Ltd Xstrata PLC $6,523 34.32%
10/21/2004 Kidde PLC United Technologies Corp $2,476 31.21%
10/18/2004 Gold Fields Ltd Harmony Gold Mining Co Ltd $8,238 32.03%
8/24/2004 UFJ Holdings Inc Sumitomo Mitsui Finl Grp Inc $29,261 42.85%
7/1/2004 DRS Technologies Inc L-3 Communications Hldg Inc $1,155 50.27%
5/27/2004 Wheaton River Minerals Ltd Coeur d'Alene Mines Corp $2,308 56.24%
5/27/2004 Marks & Spencer Group PLC Revival Acquisitions Ltd $16,699 44.40%
5/24/2004 NeighborCare Inc Omnicare Inc $1,821 44.19%
2/11/2004 Walt Disney Co Comcast Corp $66,755 6.29%
1/26/2004 Aventis SA Sanofi-Synthelabo SA $60,243 27.51%
11/7/2003 Canary Wharf Group PLC CWG Acquisition Ltd $3,047 4.96%
10/6/2003 UGC Europe Inc UnitedGlobalCom Inc $1,352 32.85%
7/8/2003 Dana Corp ArvinMeritor Inc $2,668 65.44%
7/7/2003 Pechiney SA Alcan Inc $5,302 73.02%
6/6/2003 PeopleSoft Inc Oracle Corp $10,467 64.49%
5/20/2003 Centerpulse AG Zimmer Holdings Inc $3,265 30.31%
5/12/2003 Debenhams PLC Laragrove Ltd $2,493 52.87%
3/10/2003 Iberdrola SA Gas Natural SDG SA $16,962 21.52%
3/3/2003 Six Continents PLC Cap Management & Investment $9,090 36.42%
1/22/2003 Metrovacesa SA Investor Group $1,900 33.33%
1/15/2003 Taubman Centers Inc Investor Group $1,714 23.07%
12/13/2002 Goodman Fielder Ltd Burns Philp & Co Ltd $1,178 13.54%
11/13/2002 Taubman Centers Inc Simon Property Group Inc $1,536 35.14%
10/23/2002 GB-Inno-BM SA Investor Group $1,183 9.38%
10/21/2002 Fording Inc Sherritt Coal Partnership II $1,156 58.01%
9/23/2002 Dole Food Co Inc David H Murdock $1,464 18.00%
5/31/2002 Hotels.com USA Interactive $1,015 -18.20%
5/27/2002 AurionGold Ltd Placer Dome Asia Pacific Ltd $1,190 62.71%
5/20/2002 Partek AB Oy Kone Corp $1,135 20.94%
5/15/2002 Castorama Dubois Kingfisher PLC $4,362 7.63%
3/21/2002 Haslemere NV Investor Group $1,404 32.93%
2/22/2002 TRW Inc Northrop Grumman Corp $6,678 32.82%
12/17/2001 P&O Princess Cruises PLC Carnival Corp $5,538 161.06%
9/5/2001 Normandy Mining Ltd Anglogold Ltd $2,164 72.34%
8/14/2001 CenturyTel Inc ALLTEL Corp $9,403 32.92%
8/6/2001 US Airways Group Inc Global Airlines Corp $10,060 81.82%
8/1/2001 Cooper Industries Inc Danaher Corp $6,965 41.78%
7/2/2001 Edison SpA Italenergia Bis SpA $2,139 8.71%
6/23/2001 Overseas Union Bank Ltd DBS Group Holdings Ltd $5,182 32.82%
6/12/2001 Howard Smith Ltd Wesfarmers Ltd $1,355 43.51%
6/12/2001 Keppel Capital Holdings Ltd Oversea-Chinese Bkg Corp Ltd $3,754 32.72%
5/31/2001 FH Faulding & Co Ltd Mayne Nickless Ltd $1,218 39.09%
5/20/2001 Storebrand ASA Den Norske Bank Holding ASA $1,913 10.60%
5/14/2001 Wachovia Corp,Winston-Salem,NC SunTrust Banks Inc,Atlanta,GA $14,443 14.85%
5/8/2001 Newport News Shipbuilding Inc Northrop Grumman Corp $3,057 30.56%
3/31/2001 HIDROCANTABRICO Ferroatlantica SL $2,381 33.22%
3/7/2001 Barrett Resources Corp Shell Oil Co $2,438 21.33%
2/27/2001 Fletcher Challenge Energy Peak Petroleum Co $1,327 -1.77%
2/19/2001 Sulzer AG Incentive Capital AG $2,658 12.95%
1/31/2001 Abbey National PLC Lloyds TSB Group PLC $28,949 27.72%
11/13/2000 Willamette Industries Inc Weyerhaeuser Co $7,857 106.03%
6/23/2000 North Ltd Rio Tinto Ltd $2,091 74.63%
5/31/2000 Hyder PLC WPD Holdings UK $3,403 81.36%
5/18/2000 Woodside Petroleum Ltd Shell Australia Ltd $3,397 45.95%
5/2/2000 Bestfoods Unilever PLC $25,065 53.28%
3/30/2000 Nabisco Group Holdings Corp Carl Icahn $1,300 54.07%
3/8/2000 Pinnacle Entertainment Inc Harveys Casino Resorts $1,353 29.45%
3/6/2000 Dime Bancorp Inc,New York,NY North Fork Bancorp,Melville,NY $1,908 -12.83%
3/2/2000 Shared Medical Systems Corp Eclipsys Corp $1,869 36.73%
2/24/2000 Aetna Inc Investor Group $10,031 30.68%
2/22/2000 Mirage Resorts Inc MGM Grand Inc $6,483 66.34%
2/1/2000 Blue Circle Industries PLC Lafarge SA $5,758 25.08%
1/27/2000 NCL Holding ASA Carnival Corp $1,301 82.64%
Average: 33.95%
(1) Source: Thomson Financial, Bloomberg, Press Releases, Public Filings.
Global Hotel and Casino Hostile Transactions ( > US$1 Billion) - January 1, 2000 to December 16, 2005(1)
- -------------------------------------------------------------------------------------------------------------------------------
Premium
Value of 20 trading days
Date Transaction prior to
Announced Target Name Acquiror Name (US$ mm) ann. date
- -------------------------------------------------------------------------------------------------------------------------------
12/2/2005 Fairmont Hotels & Resorts Inc Icahn Partners LP $1,186 14.03%
3/3/2003 Six Continents PLC Cap Management & Investment $9,090 36.42%
2/22/2000 Mirage Resorts Inc MGM Grand Inc $6,483 66.34%
Average: 38.93%
(1) Source: Thomson Financial, Bloomberg, Press Releases, Public Filings.
Canadian Hostile Transactions ( > US$500 million) - January 1, 2000 to December 16, 2005(1)
- -------------------------------------------------------------------------------------------------------------------------------
Premium
Value of 20 trading days
Date Transaction prior to
Announced Target Name Acquiror Name (US$ mm) ann. date(2)
- -------------------------------------------------------------------------------------------------------------------------------
12/2/2005 Fairmont H&R Inc. (51%) Icahn Partners LP $1,186 14.03%
11/23/2005 Dofasco Inc. Arcelor SA $4,219 50.15%
11/8/2005 Royster-Clark Agrium Inc. $535 28.21%
10/31/2005 Placer Dome Inc. Barrick Gold Corp. $9,348 19.81%
10/28/2005 Hudson's Bay Co. Maple Leaf Heritage Investments C$1,032 8.86%
9/15/2005 Canico Resource Corp. CVRD $646 56.39%
5/14/2004 Microcell Telecommunic-Cl A Rogers Wireless Communications $688 47.74%
Inc.
12/9/2002 Canada Life Financial Corp Great-West Lifeco Inc. $3,735 51.62%
10/21/2002 Fording Inc Fording Canadian Coal Trust $1,149 54.73%
2/20/2001 Luscar Coal Income Fund Sherritt International/OTPP $622 76.21%
12/27/2000 Berkley Petroleum Corp Anadarko Petroleum Corp. $904 68.89%
11/11/2000 Mackenzie Financial Corp IGM Financial Inc. $2,305 57.89%
8/22/2000 Rio Algom Ltd BHP Biliton PLC $1,692 52.11%
4/6/2000 Ranger Oil Ltd Canadian Natural Resources $1,028 57.14%
4/5/2000 Ulster Petroleums Anderson Exploration $584 60.62%
Average: 46.96%
(1) Source: Thomson Financial, Bloomberg, Press Releases, Public Filings.
(2) Premium for pending transactions based on latest highest offer.
Analysis of Float
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Shares Value of
Price Out Float Float Float
Company ($US) (1) (mm) (2) (mm) (3) (%) ($mm) Icahn Pro Forma Holdings Calculation (mm)
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Starwood 63.43 217.7 216.7 99.5 13,743 Icahn Current FHR Shares (as of 12/2/05) 7.1
Marriott Int'l 66.96 208.4 171.7 82.4 11,498 Icahn Bid to Acquire Additional Shares 29.6
Hilton Corp 22.58 381.5 351.8 92.2 7,943 -------
Host Marriott 18.39 353.5 335.4 94.9 6,167 Total Pro Forma Icahn Shares 36.8
FHR Pre-Icahn 40.18 72.3 72.1 99.7 2,897
FHR Post-Icahn(4) 40.18 72.3 35.3 48.9 1,420
Four Seasons 48.21 32.9 25.3 77.0 1,220
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Notes:
1 As of December 20, 2005; Source: Bloomberg
2 Based on basic (undiluted) numbers of shares outstanding; Source: Bloomberg
3 Source: Bloomberg
4 FHR Post-Icahn Float calculated as current float (72.1mm shares) less Pro Forma shares owned by Icahn (36.8mm)