Icahn Suffers Several Setbacks

Billionaire corporate raider Carl Icahn is on a personal losing streak.


Billionaire corporate raider Carl Icahn is on a personal losing streak. On Monday, he postponed his tender offer for Lions Gate Entertainment for the second time when less than 8 percent of stockholders — excluding the 19 percent held by Icahn — tendered their shares.

On Wednesday, the independent film company, which opposes Icahn’s efforts, said a majority of investors who voted supported Lions Gate’s poison pill. The pill, also called a shareholder rights plans, is perceived to make it harder for someone to complete a hostile takeover of a company. Of course, this vote could be moot since last month The British Columbia Securities Commission voided the pill and last week the British Columbia Court of Appeals upheld that ruling.

Icahn’s setbacks come on the heels of his loss last month to Donald Trump in their 14-month battle over control of bankrupt casino company Trump Entertainment Resorts. Trump was supported by another hedge fund manager, Avenue Capital’s Marc Lasry.

Icahn, who is now 74, is not exactly packing up his activism and going home. To quote Sarah Palin, he is “just reloading.” Earlier this week, he disclosed in a regulatory filing that he had upped his stake in Motorola to 8.75 percent. This is the first change in his Motorola stake since 2008. Motorola, of course, is the scene of an earlier Icahn victory. It plans to break itself into two companies in the first quarter of 2011, in part as a result of Icahn’s prodding.

In 2008, Motorola also agreed to place two of Icahn’s people on its Board of Directors. Perhaps Icahn, who paid $6.65 for most of the new shares, plans to revive his battle with the company. Its stock has since risen to $6.99. I’m looking forward to Motorola — Round II.

Stephen Taub

Stephen Taub

Stephen Taub , who has covered the hedge fund industry for 30 years, is a contributing editor to Institutional Investor and Absolute Return-Alpha magazines.