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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. 1)*
Lear Corporation
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(Name of Issuer)
Common Stock, $0.01 Par Value
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(Title of Class of Securities)
521865105
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(CUSIP Number)
Mr. Richard S. Pzena
Pzena Investment Management, LLC
120 West 45th Street, 20th FL
New York, NY 10036
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 9, 2007
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(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 Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[X].
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 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).
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CUSIP NO. 521865105 SCHEDULE 13D PAGE 2 OF 8 PAGES
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Pzena Investment Management, LLC (I.R.S. Number 13-3860154)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [_]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
NUMBER OF
SHARES 5,204,734
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8 SHARED VOTING POWER
0
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9 SOLE DISPOSITIVE POWER
6,776,279
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,776,279
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[-]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.05%
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14 TYPE OF REPORTING PERSON*
IA
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CUSIP NO. 521865105 SCHEDULE 13D PAGE 3 OF 8 PAGES
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ITEM 1. SECURITY AND ISSUER
The Schedule 13D filed filed by Pzena Investment Management, LLC ("PIM") with
the Securities and Exchange Commission on March 29, 2006 (the "Initial 13D"), by
the Reporting Persons with respect to the shares of common stock, $0.01 par
value (the "Shares"), issued by of Lear Corporation (the "Company"), is hereby
amended to furnish the additional information set forth herein.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Item 3 of the Initial 13D is hereby amended by the addition of the following:
PIM has purchased 6,776,279 Shares on behalf of its clients. The fair market
value of the Shares is $266,917,629. Funds for these purchases were derived from
PIM clients.
ITEM 4. PURPOSE OF TRANSACTION
Item 4. of the Initial 13D is hereby amended by the addition of the following:
PIM purchased the Shares of the Company on behalf of PIM clients for investment
purposes. Depending on PIM's assessment of future developments, PIM may acquire
additional securities on behalf of PIM clients or may determine to sell or
otherwise dispose of all or some of its Share holdings in accordance with its
investment strategies.
On February 5, 2007, American Real Estate Partners, L.P. ("AREP"), an entity
controlled by Mr. Carl Icahn, announced an acquisition proposal to Lear
Corporation, which calls for a merger of the Company with a newly formed
subsidiary of AREP, pursuant to which shareholders of the Company would receive
$36 per share in cash.
On February 5, 2007, PIM forwarded a letter to the Independent Directors of the
Company stating its objections to the announced transaction with AREP. A copy of
that letter is filed herewith as Exhibit 1 and incorporated by reference herein.
On February 9, 2007, according to announcements by the Company and AREP,
newly-formed subsidiaries of AREP entered into an Agreement and Plan of Merger
with Lear Corporation ("Agreement") calling for a merger of the Company and one
of such subsidiaries pursuant to which the Company will become a subsidiary of
AREP and stockholders of the Company will receive $36 per share in cash.
PIM has contacted and intends to further contact other shareholders of the
Company to express its opposition to the proposed transaction. PIM may also
engage in discussions with the Independent Directors of the Company. Except as
set forth above, PIM does not currently intend to engage in any of the
transactions set forth in clause (a) through (j) of Item 4 of Schedule 13(d).
CUSIP NO. 521865105 SCHEDULE 13D PAGE 4 OF 8 PAGES
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ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
Item 5. of the Initial 13D is hereby amended by the addition of the following:
Number Percentage of
Reporting Person of Shares Shares
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(a) Pzena Investment Management, LLC 6,776,279 10.05%
(b) PIM currently exercises voting authority over shares of common stock in
the accounts of PIM clients that have delegated proxy voting authority to PIM.
Such voting authority may be withdrawn by PIM clients at any time.
SOLE POWER TO VOTE OR DIRECT THE VOTE:
Pzena Investment Management, LLC 5,204,734
Shared Power to vote or direct the vote:
Pzena Investment Management, LLC 0
SOLE POWER TO DISPOSE OR TO DIRECT THE DISPOSITION:
Pzena Investment Management, LLC 6,776,279
SHARED POWER TO DISPOSE OR TO DIRECT THE DISPOSITION:
Pzena Investment Management, LLC 0
(c) The following table sets forth the Reporting Person transactions in the
Shares during the last 60 days:
Pzena Investment Management, LLC
All transactions listed in the schedule below were done at PIM's discretion for
PIM's clients.
CUSIP NO. 521865105 SCHEDULE 13D PAGE 5 OF 8 PAGES
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Number of Average Price Transaction
Date Shares Per Share Effected
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11/1/2006 750 30.052 Open Market Sale
11/13/2006 112175 33.0843 Open Market Sale
11/13/2006 8700 33.1563 Open Market Sale
11/13/2006 2750 33.1 Open Market Sale
11/14/2006 2500 33.134 Open Market Sale
11/14/2006 7925 33.314 Open Market Sale
11/14/2006 4225 32.9771 Open Market Sale
11/14/2006 4150 33.3225 Open Market Sale
11/14/2006 61150 33.0418 Open Market Sale
11/14/2006 76425 33.1339 Open Market Sale
11/14/2006 4000 33.03 Open Market Sale
11/14/2006 63500 33.2538 Open Market Sale
11/15/2006 89025 34.0581 Open Market Sale
11/15/2006 11500 33.289 Open Market Sale
11/15/2006 14500 33.973 Open Market Sale
11/15/2006 24925 34.0032 Open Market Sale
11/15/2006 28250 33.7646 Open Market Sale
11/15/2006 77925 34.072 Open Market Sale
11/15/2006 51350 34 Open Market Sale
11/16/2006 75892 33.5209 Open Market Sale
11/16/2006 58650 33.6806 Open Market Sale
11/16/2006 3475 33.5494 Open Market Sale
11/17/2006 5200 33.3027 Open Market Sale
11/17/2006 2650 33.1508 Open Market Sale
11/17/2006 2475 33.1475 Open Market Sale
11/17/2006 14958 33.4781 Open Market Sale
11/20/2006 112350 33.8287 Open Market Sale
11/20/2006 94950 33.53 Open Market Sale
11/21/2006 4800 32.7008 Open Market Sale
11/21/2006 13250 33.0531 Open Market Sale
11/22/2006 2525 31.9481 Open Market Sale
12/5/2006 2900 30.1472 Open Market Purchase
12/6/2006 200 30.05 Open Market Sale
12/7/2006 8675 30.4598 Open Market Purchase
12/15/2006 9175 30.47 Open Market Sale
12/20/2006 575 29.26 Open Market Purchase
12/22/2006 4850 29.0403 Open Market Sale
1/8/2007 19950 28.0573 Open Market Purchase
1/9/2007 4050 27.6926 Open Market Sale
1/9/2007 4050 27.6967 Open Market Purchase
1/10/2007 1225 27.8 Open Market Sale
1/16/2007 17600 32.6506 Open Market Sale
1/16/2007 20000 32.6718 Open Market Sale
CUSIP NO. 521865105 SCHEDULE 13D PAGE 6 OF 8 PAGES
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1/16/2007 59850 32.614 Open Market Sale
1/16/2007 35000 32.8151 Open Market Sale
1/16/2007 8675 32.7021 Open Market Sale
1/16/2007 8600 32.441 Open Market Sale
1/16/2007 8850 32.5845 Open Market Sale
1/16/2007 3900 32.019 Open Market Sale
1/16/2007 26975 32.8029 Open Market Sale
1/16/2007 800 32.7401 Open Market Sale
1/16/2007 850 32.8088 Open Market Sale
1/16/2007 450 32.7067 Open Market Sale
1/16/2007 28200 32.65 Open Market Sale
1/17/2007 825 33.5 Open Market Sale
1/17/2007 625 33.28 Open Market Sale
1/22/2007 7200 33.3058 Open Market Sale
1/23/2007 4825 33.5536 Open Market Sale
1/23/2007 8000 33.5525 Open Market Sale
1/25/2007 6100 35 Open Market Sale
1/30/2007 1500 34.25 Open Market Sale
1/31/2007 29075 34.0233 Open Market Sale
1/31/2007 15200 34.1411 Open Market Sale
1/31/2007 83175 33.9876 Open Market Sale
2/1/2007 18600 34.1219 Open Market Sale
2/1/2007 105725 34.1315 Open Market Sale
2/1/2007 19375 34.1343 Open Market Sale
2/1/2007 10200 34.1493 Open Market Sale
2/1/2007 8525 34.1174 Open Market Sale
2/1/2007 3100 34.1906 Open Market Sale
2/1/2007 1400 34.1 Open Market Sale
2/2/2007 2150 34.35 Open Market Sale
2/2/2007 18325 34.4008 Open Market Sale
2/2/2007 20075 34.2977 Open Market Sale
2/2/2007 625 34.11 Open Market Purchase
2/2/2007 45525 34.5515 Open Market Sale
2/2/2007 400 34.62 Open Market Sale
2/2/2007 1875 34.5063 Open Market Sale
2/2/2007 2150 34.3549 Open Market Sale
2/2/2007 18200 34.6314 Open Market Sale
2/2/2007 725 34.37 Open Market Sale
2/2/2007 1075 34.5891 Open Market Sale
(d) PIM, an investment advisor registered under the Investment Advisers Act of
1940, pursuant to investment advisory contracts with its clients has dispositive
power over the Shares in the PIM investment advisory accounts of clients. The
individual clients, none of whom individually owns beneficially more than 5% of
the total class of such securities, have the right to receive or the power to
direct the receipt of dividends from, and the proceeds from the sale of the
Shares.
(e) Not Applicable
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
The following document is being filed as an exhibit to this statement and is
incorporated herein by reference:
1. Letter dated February 5, 2007, from Richard S. Pzena and John P. Goetz of
Pzena Investment Management, LLC to the Independent Directors of Lear
Corporation.
CUSIP NO. 521865105 SCHEDULE 13D PAGE 7 OF 8 PAGES
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
February 13, 2007
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(Date)
/s/ Richard S. Pzena
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(Signature)
Richard S. Pzena, CEO
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(Name/Title)
Attention. Intentional misstatements or omissions of fact constitute federal
Criminal violations (see 18 U.S.C. 1001).
CUSIP NO. 521865105 SCHEDULE 13D PAGE 8 OF 8 PAGES
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EXHIBIT 1
February 5, 2007
To the Independent Directors of Lear Corporation:
We are writing to express our alarm about the possible sale of Lear Corporation
to Carl Icahn's American Real Estate Partners LP at a price which we believe to
be far below the fair value of the company. As you know, we are one of Lear's
largest shareholders and we have long believed in Lear's business and its plan
for recovery. Our view is that the company's earnings are well below their
normal level and that Lear is being valued by the market as if there is little
chance of an earnings recovery. Our analysis suggests that earnings are likely
to recover to more than $4.00 per share over the next few years from consensus
analyst estimates of $2.00 per share for 2007. Consequently, we believe the
company's value to be closer to $60 per share.
As you may or may not know, we had a lengthy discussion with Mr. Icahn's team in
November when they bought their stake in the company at a very attractive price.
We shared our belief in the greater than $4.00 earnings power and $60 valuation
and they appeared to agree with our assessment at that time. To claim today that
$36 is a fair price is quite disingenuous.
It is our fear that the company's management may have lost sight of the
long-term value inherent in the company and that their personal interest in the
transaction may create an inherent conflict. We are well aware of Wall Street's
short-term mentality and the pressure it can bring on companies. It is our hope
that Lear does not succumb to that pressure and sell the business for less than
it is worth over the long term.
We would like to remind the board of its fiduciary obligation to shareholders
and urge you to seek other offers for the firm. We think it is incumbent on the
board to exclude the management from this process since preserving their jobs
and/or enriching themselves can come at the expense of shareholders. The trend
towards private equity firms teaming up with management to "steal" companies
from their owners is alarming and we urge you to take a stand to ensure this
does not happen at Lear.
We are happy to meet with you to share our view of valuation should you deem it
interesting or desirable. To the extent that this particular transaction is put
to a shareholder vote, we intend to vote against it.
Sincerely,
/s/ Richard S. Pzena /s/ John P. Goetz
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Richard S. Pzena John P. Goetz
Co-Chief Investment Officer Co-Chief Investment Officer