Dec. 4 (Bloomberg) -- New York real estate investor Harry Macklowe withdrew from a partnership led by financier Carl Icahn that had promised to deliver by today a formal offer for Reckson Associates Realty Corp.

Icahn's offer of $49 a share, or $4.26 billion, for the Uniondale, New York-based real estate investment trust ``will not be forthcoming,'' Reckson said in a statement. Icahn told Reckson he may make a revised offer, according to the statement, which didn't say when that offer would be made.

``Icahn-affiliated parties may deliver a revised proposal to acquire Reckson,'' the company said.

Macklowe was the second Icahn partner to drop out of the bidding group in two days. Mack-Cali Realty Corp. withdrew on Saturday. With no counter bid yet from Icahn, Reckson shareholders are scheduled to vote Dec. 6 on a $3.8 billion cash and stock offer by SL Green Realty Corp., New York's biggest office landlord. The vote has twice been delayed since Icahn and Macklowe said on Nov. 16 they intended to submit a higher bid.

It was Macklowe who first suggested to Icahn that the two make an offer for Reckson, which had already agreed to be acquired by SL Green, according to a Nov. 27 filing by Icahn with the U.S. Securities and Exchange Commission. Icahn and Macklowe together acquired a stake of about 8 percent in Reckson, which would have made them the single-largest holder, according to Bloomberg data. About 3.9 percent of that was held by Macklowe.

`Icahn Was Approached'

``Mr. Icahn was approached by Harry Macklowe who suggested that it could be profitable for Icahn entities and Macklowe entities to bid for the Issuer and its assets,'' Icahn said in the filing, which detailed the holdings.

After two weeks of examining the company's financial information, Macklowe and Icahn differed on the value of Reckson's assets, a person familiar with the negotiations said.

Scott Hynes, a spokesman for Macklowe, declined to comment. Icahn didn't return phone messages left at his home and office.

SL Green agreed on Aug. 3 to acquire Reckson, the owner of owner of 101 properties in the New York region, including five Midtown Manhattan skyscrapers. SL Green, whose chairman is Stephen Green, made a cash and stock offer that was worth $43.31 a share that day. SL Green's offer was worth $45.70 per share based on the company's closing share price on Dec. 1.

Mack-Cali Chief Executive Officer Mitchell Hersh confirmed in a telephone interview that his Edison, New Jersey-based REIT, a rival of Reckson's in New York's suburban office markets, had exercised an exit clause in his partnership agreement that allowed it to withdraw up until 11:59 p.m. on Saturday. That agreement had been filed with the U.S. Securities and Exchange Commission two days earlier.

Mack-Cali Withdraws

Mack-Cali's withdrawal was reported yesterday in a statement issued by the Reckson board, which also said that as of yesterday, Icahn's group hadn't provided financial information affirming the offer, which would be worth $4.26 billion based on Reckson's 83.8 million shares of outstanding stock.

Icahn, in a Nov. 16 interview, said he believed SL Green's offer was less than what Reckson's properties were worth. ``I buy assets that are undervalued and I obviously think these are undervalued,'' Icahn said at the time.

Icahn's offer came after some shareholders, including Arnhold & S. Bleichroeder LLC, criticized Reckson's acceptance of SL Green's offer, particularly a $2.1 billion side deal under which the buyer would resell most of its suburban buildings to a group led by Scott Rechler, Reckson's chief executive officer. Those properties should have been offered to the open market, they said.

The Reckson board, which took over negotiating the deal after Rechler struck the side deal, has said the price of the suburban assets was fair, and that SL Green was motivated to get a full price for them.

To contact the reporters on this story: David M. Levitt in New York at dlevitt@bloomberg.net; Dana Cimilluca in New York at dcimilluca@bloomberg.net;

Last Updated: December 4, 2006 00:04 EST