Carl Celian Icahn is a prominent American business figure who started as a trader in the stock market. He is the founder and majority owner of the large investment company Icahn Enterprises. In 2008 Carl Icahn’s name was included in the list of 46 richest people in the world according to Forbes magazine. At the age of 77 in 2013, Icahn is still actively investing in the stock market. Last year the cumulative return on personal investment and its employees still made a profit of 20%. He is known as an excellent negotiator in making big deals. On Wall Street there is the term “Icahn Lift” to describe the trend in stock prices that reversed up when Carl Icahn started buying shares of the company.
Born in Brooklyn and raised in Queens, New York, Carl Icahn was educated in philosophy at Princeton University and briefly attended New York University’s School of Medicine. He then worked at the stock brokerage firm Dreyfus & Company for 7 years before trading options with his own capital on the New York Stock Exchange (NYSE). Shortly thereafter he founded Icahn & Co., a securities firm focused on arbitrage risk and options trading.
In the late 1970s, Icahn began making bulk purchases of certain stocks. With negotiations that were quite tough and tended to be hostile, in 1985 his company succeeded in taking over TWA. Then followed several large companies such as RJR Nabisco, Texaco, Phillips Petroleum, Western Union, Gulf & Western, Viacom, Revlon, Fairmont Hotels, Blockbuster, Kerr-McGee, Time Warner and Motorola. This year Icahn also bought a portion of Herbalife, a dietary supplement company.
Icahn knows no retirement. When interviewed with Time Magazine Icahn says he remains competitive and doesn’t want to retire playing golf in Florida. “I want to make a profit. There’s nothing wrong with that, and that’s what I want to do, and I enjoy it.” said Carl Icahn, who in February received an award as one of the 40 high-income hedge fund managers.
Icahn’s investment strategy is to target companies whose share values are undervalued. When the price movement is in a downtrend, and most investors are selling, they buy it. He then accumulated shares until the number was sufficient to target a position on the board of directors. Usually he replaces the CEO or breaks the company into several parts and sells them separately. In this way he managed to convince investors to buy the stock until the price continued to rise.
“CEOs are paid handsomely for dealing with dire and unfortunate circumstances. If the system always runs smoothly, people like me won’t be able to make a profit.” said Icahn, who is also known as a donor to several health education and research foundations in New York.