Who is Carl Icahn?

Published by Thomas Herold in Investments, Trading

'Carl Icahn' is explained in detail and with examples in the Trading edition of the Herold Financial Dictionary, which you can get from Amazon in Ebook or Paperback edition.

Carl Icahn is a billionaire corporate raider, investor, hedge fund manager, and philanthropist. He earned a vast fortune operating as one of the infamous corporate raiders of Wall Street back in the 1980s. He is consistently ranked in the top 100 richest men, and he secured the spot of 43 on the Forbes’ billionaire list for 2016.

Carl Icahn was born in 1936 in New York City. He started a financial career in 1961 working for Dreyfus & Co. as a broker. By 1968, he had been successful enough to get his uncle’s financial help to secure a New York Stock Exchange seat. With this, he opened his own securities firm Icahn & Co. dedicated to options trading and arbitrage plays.

By the late 1970s, Carl Icahn had moved his efforts on to taking over a family owned appliance company Tappan. Once he was the majority share holder, he started a proxy battle to sell the company. His first successful corporate raid allowed him to sell the outfit to Electrolux for double the share prices. This was to be his first of many ventures that earned him a leading reputation among the corporate raiders throughout he 1980s.

Icahn would do this via a process called greenmail. He would threaten to gain control of major corporations like Viacom, Phillips Petroleum, RJR Nabisco, Texaco, and Marshall Field. He later sold his stocks and exited with substantial gains for he and his partners. His defenders say that he also made regular shareholders major money in the process. He became so good at this that his real life endeavors inspired the Wall Street 1987 blockbuster movie main character Gordon Gekko.

Not all of Carl Icahn’s efforts succeeded. He tried to run some companies that he purchased. He met with success with American Car & Foundry Company, but lost money with the TWA (Trans World Airlines) bankruptcy and the failure with Time Warner. Though other Wall Street raiders such as Michael Milken and Ivan Boesky fell victim to scandal, Icahn avoided their mistakes and managed to carry his activist investing successfully through the 1990s and early 2000s. Even when he failed to take over RJR Nabisco, he still earned over $600 million in the battle.

Carl Icahn opened his first hedge fund in 2004. This failed to break up Time Warner or to gain control of Blockbuster. He had more success in selling companies such as Kerr-McGee and Mylan Laboratories. He took on the role of CEO of Icahn Capital LP, subsidiary company to his Icahn Enterprises in 2007. His fund closed to investments from outsiders in 2011. The year 2012 saw him acquire a major stake in Netflix. Though over 80 years old, he continues to capture headlines in dealings with Apple and eBay and a feud he went though publicly with Bill Ackman of Pershing Square Capital Management. In 2016, he held majority stakes in firms Tropicana Entertainment, XO Communications, and CVR Energy.

Besides being a tough negotiator and ruthless investor, Carl Icahn has also shown a more humanitarian side to the world. He has given substantially to medical research and education. Genomics has been a specialty interest of his. In 2012, he provided a $200 million donation to Mount Sinai School of Medicine. He also set up the Icahn Scholars Program to help bring over the top physician scientists to the school. He has also founded a number of homeless shelters and charter schools throughout the Bronx and New York City.

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The term 'Carl Icahn' is included in the Trading edition of the Herold Financial Dictionary, which you can get from Amazon in Ebook or Paperback edition.