April 17, 2024

The Raider in Winter: Carl Icahn at 75

“What else would I do? Play shuffleboard somewhere?” Mr. Icahn grumbles into the phone from his vacation home in Indian Creek, Fla., the rarefied enclave near Miami.

It’s an old line, the one Mr. Icahn huffs, with over-my-dead-body pique, just about every time the subject of retirement comes up. No, at age 75 and a billionaire several times over, Carl Icahn will not go quietly.

Mr. Icahn has spent four decades making trouble for corporate America — and making a lot of money for himself and his investors. But now, midway through his eighth decade, he has begun to contemplate his legacy, and the future of the Icahn empire hangs in the balance. What will they say about him? He bristles at being called a corporate raider, though if you Google the phrase you’ll soon find his name. He prefers something friendlier: activist investor.

So behold the raider — or the activist, take your pick — in winter: rich, yes, but so entranced by the game that he can’t quite let go. One of his chief lieutenants, an up-and-comer, recently abandoned him: Keith A. Meister, widely considered his right-hand man, left the fold late last year. Mr. Meister was a pivotal player at Mr. Icahn’s multibillion-dollar hedge fund, as well as at his flagship Icahn Enterprises, his investment holding company. But with $250 million from George Soros, Mr. Meister opened a hedge fund of his own. He was joined in January by Rupal Doshi, formerly chief operating officer of the Icahn Group. (Both declined to comment for this article.)

Shortly afterward, Mr. Icahn abruptly announced he would close his own hedge fund. He had opened the fund, to much fanfare, in 2004. But Mr. Icahn lost so much money during the financial crisis that he is still a bit shaken by the experience. He is returning all outside investors’ money. Henceforth, Carl Icahn will manage money only for Carl Icahn.

In a March 8 letter to his fund’s investors, Mr. Icahn said he was still unsettled by the events of 2008, when his fund plummeted 35 percent.

“Given the rapid market run-up over the past two years and our ongoing concerns about the economic outlook, and recent political tensions in the Middle East, I do not wish to be responsible to limited partners through another possible market crisis,” Mr. Icahn wrote in his letter.

Managing other people’s money was a headache, Mr. Icahn says. Besides, he thinks the markets are headed for a fall. “You’ve got to be a fool if you don’t think there will be a correction,” he says.

And so, with Mr. Meister gone, Mr. Icahn’s son, Brett C. Icahn, waits in the wings. The younger Icahn, 31, entered the family business after graduating from Princeton and spending a few relatively fruitless years directing movies.

Carl Icahn says his son is ready for more. But he denies he has anointed him as his successor, as many outsiders suspect. “I give him more and more responsibility because he’s earned it, but it’s not nepotism,” Carl Icahn says of his son. “He’s got good instincts.”

Brett Icahn — or whoever succeeds his father, if anyone really can — has some big shoes to fill.

“When it’s a company that’s so identified with the style, personality and skills of a single owner, you really don’t know how it will evolve,” says Stephen M. Davis, executive director of the Millstein Center for Corporate Governance and Performance at the Yale School of Management. “Carl Icahn has a skilled team — there’s no doubt about that — but it really does rest upon his leadership.”

CARL ICAHN runs his investment business from elegant offices 47 floors above Fifth Avenue in Midtown Manhattan. He declined to be interviewed in person for this story.

Instead, he spoke by phone, from his offices in New York and his home in Florida, over the course of several weeks, a dozen or so conversations in all. He orchestrated the interviews as if he were cutting a deal, which, in some ways, he was: he spoke on the condition that he could vet every quotation.

What, really, is left to say about Carl Celian Icahn? Even those who are too young to remember his exploits in the 1980s know the stories. Born and raised in Queens to parents of relatively modest means, Carl helped pay his way through Princeton with winnings from poker. His parents wanted him to become a doctor, so the obedient son went to medical school. Then a patient with tuberculosis coughed on him.

“I said,” he recalled, “I’m done — I quit.”

Article source: http://www.nytimes.com/2011/04/17/business/17icahn.html?partner=rss&emc=rss

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