Clorox's board rejected Carl Icahn's initial bid of $76.50 per share and his subsequent bid of $80 per share indicating that both bids undervalued the firm's true worth. This example suggests that investors sometimes use the market for corporate control to take ownership in firms that are performing well.

Question

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Investors like Carl Icahn often target firms they believe are undervalued, suggesting that the market for corporate control can be used to acquire well-performing companies at a perceived discount.

Clorox's Board Rejected Carl Icahn's Initial Bid of $76