The billionaire hedge fund manager sent a letter to Clorox CEO Don Knauss this week, offering to pay $76.50 per share in cash, according to a regulatory filing Friday.
That price is a 12 percent premium to Thursday's closing price of $68.43 per share. The stock leapt on Friday to trade closer to the offer price.
Icahn valued his offer at $12.6 billion. That appears to include $10.2 billion in cash, plus taking on debt and other costs.
Clorox, the California-based maker of Burt's Bees chapstick, Glad trash bags and Brita water filters, said its board would review the offer "in due course" and couldn't comment until then. Spokesman Dan Staublin said the board is "committed to acting in the best interests of our company and our shareholders."
Icahn is already Clorox's biggest shareholder, after spending nearly $800 million to buy a 9.4 percent stake in December. He has already made money on the investment: As of Thursday, shares had risen about 8 percent since his investment.
Icahn seemed more interested in drumming up other buyers than actually buying Clorox himself. In his letter, Icahn said that shareholders would benefit the most if Clorox were sold to another consumer products company that could take advantage of "significant inherent synergies." He suggested that Procter & Gamble Co., Unilever PLC, Colgate-Palmolive Co. and other rivals might be interested, and expressed confidence that Clorox would find "numerous superior bids" if it shopped itself around.
If no other bidders stepped forward, Icahn wrote, then "our fellow stockholders" should have the opportunity to vote on the Icahn bid.
Icahn is known for buying and shaking up the companies he purchases, with mixed success. His other holdings at the end of the first quarter included the drugmaker Biogen Idec Inc., movie studio Lions Gate Entertainment Corp., Motorola Solutions Inc. and power producer Dynegy Inc., according to a May 16 regulatory filing.
Icahn told Clorox that if it accepts the deal by July 29 and then he fails to close it, he will pay Clorox $100 million for its "time and effort." He also said he would not ask for a breakup fee if Clorox sold itself to another bidder.
Citigroup Inc. analyst Wendy Nicholson said Icahn appears to be offering a fair price.
She and Weeden & Co. analyst Javier Escalante said they thought it unlikely that any other consumer products companies would want to buy Clorox. It is already a well-run company, so it's not clear what a new management team could do, they said. More importantly, Clorox has failed to tap the fast-growing emerging markets as well as its rivals have, and it's unlikely that other companies would be interested in saddling themselves with more exposure to saturated U.S. markets.
Anyone who did buy Clorox would probably want to get rid of some of the auxiliary businesses, such as cat litter or charcoal, Escalante said.
Despite the rise in share price, Clorox has struggled, with year-over-year revenue declining for the past three quarters. Of 14 analysts surveyed by FactSet, only two listed it as a buy.
Shares rose $5.27, or 7.7 percent, to $73.70 in midday trading Friday.
