Icahn Enterprises LP isn’t giving up on its acquisition target, Pep Boys — Manny, Moe & Jack. On Dec. 28, Icahn increased its offer to $18.50 per share, outbidding Bridgestone Retail Operations LLC by $1.50 per share.

The $18.50-per-share price places the value of Pep Boys above $1 billion.

Also on Dec. 28, the Pep Boys board determined that Icahn's offer is "superior" to the previous Bridgestone offer of $17 per share. Pep Boys has given Bridgestone official notice of its determination of the "superior" bid from Icahn, and as a result Bridgestone once again has three days to make a counter offer. Bridgestone must respond by 5 p.m. Eastern Time on Dec. 31.

As the two companies jockey back and forth on the stock price, there’s another term of the deal coming to the forefront — the termination fee. Bridgestone’s Dec. 24 offer of $17 per share also increased the termination fee from the original $35 million to $39.5 million. In its latest U.S. Securities and Exchange Commission filing, Icahn argues increasing the termination fee "is contrary to the best interests" of Pep Boys shareholders "because it would prevent a truly robust auction." (Icahn holds 12% of the company’s available shares.)

And here’s another nugget from Icahn's latest offer: it might be willing to pay even more, but "does not intend to bid any higher than $18.50 per share if the issuer agrees to any increase of Bridgestone's termination fee."

Editor's note: This story initially appeared at ModernTireDealer.com.