Carl Icahn has a ~12% stake in Pep Boys (PBY), saying the auto parts and maintenance chain's retail business should be acquired by Auto Plus. Now, Auto Plus is a company that Icahn controls.
One of PepBoys major shareholders is Mario Gabelli and GAMCO has a large stake in Pep Boys. Recall that Bridgestone is trying to buy Pep Boys to combine it with its network of tire and automotive centers. Bridgestone offered $15/share for Pep Boys. Now, Icahn is willing to pay $15.50 for the company.
Shares are trading nearly ~$1 above the offer price; investors are expecting a bidding war. There will almost certainly be a counter from Bridgestone. It's already put in a lot of work since October getting regulatory approval and financing. They may well come in at $17 a share to ensure they get the deal done. Icahn is hungry here too and may well further top any Bridgestone bid, as his offer is not contingent on any due diligence, financing or antitrust conditions. But it's in both of their best interests to work together. Icahn only wants the retail business and Bridgestone only wants the service business. The likely outcome is a back-to-back transaction where one, likely Bridgestone, buys the company and then sells the other part of the business to the other party.