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Carl Icahn

b. 1936

The corporate raider who taught Wall Street to attack its own boards

Portrait of Carl Icahn — AviateHistory — 2021 — CC0 via Wikimedia Commons

The apartment in Far Rockaway held a schoolteacher mother, a boy, and a father who sang prayers he did not believe. Michael Icahn worked as a cantor and later as a substitute teacher, and by his son's account he was a sworn atheist. Carl got himself into Princeton on his own merits, graduated in 1957 with a degree in philosophy, and wrote his senior thesis on the problem of formulating the empiricist criterion of meaning. He entered medical school at NYU, quit after two years, and served in the Army Reserve, where he won several thousand dollars at poker in the barracks. In 1961 that money went to Wall Street with him.

The method rarely changed. Buy a large stake in a company he judged badly run and undervalued, then force change from outside — proxy fights, board seats, public letters, the standing threat of a takeover — until management bought him out or the company was sold, broken up or restructured. TWA is the defining case. He took control in 1985 and owned it outright by 1988, loaded it with debt, sold off its assets, and cleared a large profit while the airline went bankrupt in 1992 and never recovered. Texaco, RJR Nabisco, Time Warner, Apple, Herbalife and Dell followed the same script.

His own case has not changed in 40 years, and he has never been shy about it. American corporate boards, he argues, are complacent and self-dealing — directors chosen by the chief executive, rubber-stamping the pay of the man who chose them — and management routinely destroys the value that belongs to shareholders. Raiders impose the discipline the market otherwise lacks. The case against him is equally direct. TWA's employees and pensioners paid for his profit while he kept it. The strategy strips a company for a short-term gain and leaves less behind than it found. And shareholder value, on this reading, was the language that made asset-stripping respectable. Both readings are seriously held, by people who watched the same 40 years.

Donald Trump named him special adviser on regulatory reform in December 2016, in an individual capacity rather than as a federal employee, so he kept his holdings — including a stake in a refiner that stood to gain from the ethanol rule change he was pushing. He stepped down in August 2017. In May 2023 the short seller Hindenburg Research called Icahn Enterprises overvalued, and the stock fell about 20 percent in a day. In August 2024 he settled SEC charges of failing to disclose billions in personal loans secured by company units, paying 500,000 dollars without admitting or denying the findings. Mount Sinai's medical school carries his name, as do homeless shelters in New York. The verdict is not settled.

Lifespan

15401700180019002030

Carl Icahn's life against the full span of the corpus — the fading end marks a life still in progress.

Notable works

Icahn & Co. company
Bought a seat on the New York Stock Exchange with 150,000 dollars of his own and 400,000 from an uncle 1968
Trans World Airlines company
Took control in 1985 and full ownership in a 1988 leveraged buyout 1985
Icahn Enterprises company
The listed holding company through which he now operates 1987
The Icahn Report other
A blog launched to argue his case against corporate boards in public 2008
Icahn School of Medicine at Mount Sinai other
Mount Sinai renamed its medical school after him 2013

Life in brief

with age at each point

February 16, 1936 aged 0 Born in Brooklyn and raised in Far Rockaway, Queens
1957 aged ~21 Graduates from Princeton with a degree in philosophy His senior thesis took on the empiricist criterion of meaning.
1968 aged ~32 Buys a seat on the New York Stock Exchange and founds Icahn & Co. The firm traded options and risk arbitrage.
1978 aged ~42 First takeover: forces the sale of Tappan to Electrolux He doubled his money and cleared 2.7 million dollars.
1985 aged ~49 Takes control of Trans World Airlines He owned it outright after a leveraged buyout in 1988.
June 1989 aged 53 Sells his Texaco stake for 2 billion dollars A 700 million dollar profit, and the largest share sale on the exchange to that date.
August 2, 2013 aged 77 Sues Dell to block Michael Dell's 24.4 billion dollar buyout
August 18, 2017 aged 81 Steps down as Trump's special adviser on regulatory reform Named in December 2016 in an individual capacity, he never gave up his business interests.
August 19, 2024 aged 88 Settles SEC charges over undisclosed pledges of Icahn Enterprises units He paid 500,000 dollars and the company 1.5 million, without admitting or denying the findings.