Bridgestone Corp. said Tuesday that it wouldn't counter the latest bid for the Pep Boys—Manny, Moe & Jack submitted by billionaire investor Carl Icahn earlier this week, apparently surrendering in what has been a continuing tug of war for the auto parts and repair chain.

In a statement released on Tuesday, the Japanese tire maker said it wouldn't response to the latest offer fielded on Monday by Icahn Enterprises LP of $18.50 a share, which valued Pep Boys at $1 billion and topped Bridgestone's own sweetened deal.

Pep Boys in a news release said its board of directors had determined Mr. Icahn's offer was at that time superior to Bridgestone's. Bridgestone had until 5 p.m. ET Thursday to respond before Pep Boys could have terminated its agreement.

The competing companies have been engaged in an extended bidding war for the chain.

Pep Boys had agreed last week to Bridgestone's higher takeover offer of $17 a share, which had arrived just before a deadline to match or exceed Mr. Icahn's earlier offer of $16.50 a share. At that time, Pep Boys said the breakup fee in its revised Bridgestone pact was increased to $39.5 million from $35 million.

Philadelphia-based Pep Boys put itself up for sale earlier this year and initially entered a takeover deal with Bridgestone in October.

Mr. Icahn, who held talks with the company earlier this year, went public with his bid at the beginning of December. Icahn Enterprises previously said it would pay 10 cents a share above any Bridgestone offer, up to $18.10 a share, under a "ratchet" structure.

Pep Boys was founded in 1921 and has more than 800 locations, according to its website. The company sells everything from tires to air fresheners. It has been ailing amid weakness in its tire business, and spending to try to boost sales.

Write to Ezequiel Minaya at ezequiel.minaya@wsj.com

(END) Dow Jones Newswires

December 29, 2015 19:25 ET (00:25 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.
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