Billionaire Icahn Wants On Motorola's Board - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Business & Finance

Billionaire Icahn Wants On Motorola's Board

The investment strategist is putting pressure on CEO Zander to buy back company shares to lift the stock price.

Investment strategist Carl Icahn is stepping up his campaign to gain a seat on Motorola's board of directors with some very tough financial talk.

The billionaire, who ranks No. 24 on Forbes 400 Richest Americans list and made a name for himself with corporate takeovers in the mid-'80s, says Motorola is sitting on a cash horde of more than $11 billion and that the Illinois-based phone maker should buy back its shares to lift the stock price.

Before news of Icahn's interest broke Tuesday, Motorola stock had dropped more than 25% in recent months. The stock jumped nearly 7% Tuesday on news that Icahn, who has a 1.39% stake in Motorola, would seek a position on the company's board of directors.

In media interviews Tuesday, Icahn focused on raising Motorola's stock price, which he said was "unrealistically low."

The activist investor's move puts the heat on Motorola chief executive Ed Zander, who boosted profits for several months after he took over the helm at the firm in 2004, but who has watched profits -- and the stock price -- drop sharply in the last quarter. A chief reason for the profit decline was the drop in price of Motorola's popular Razr mobile phone. The popular phone was initially priced at $499 but has dropped to around $50 in recent weeks.

So far, there have been no indications whether the dynamic between Icahn and Motorola will be collegiate or adversarial. In the media interviews, Icahn indicated he was interested in balance sheet items and not in operational measures at Motorola. The company hasn't taken a stand on Icahn's director's request, and it hasn't yet set a date for its annual meeting.

Zander has a handy reference point in dealing with Icahn through his appointment last week as a director of Time Warner. Icahn has been pursuing a long-running campaign aimed at Time Warner and its AOL unit to lift the price of Time Warner stock.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of IT & Cybersecurity Operations 2020
The State of IT & Cybersecurity Operations 2020
Download this report from InformationWeek, in partnership with Dark Reading, to learn more about how today's IT operations teams work with cybersecurity operations, what technologies they are using, and how they communicate and share responsibility--or create risk by failing to do so. Get it now!
Slideshows
IT Careers: 10 Industries with Job Openings Right Now
Cynthia Harvey, Freelance Journalist, InformationWeek,  5/27/2020
Commentary
How 5G Rollout May Benefit Businesses More than Consumers
Joao-Pierre S. Ruth, Senior Writer,  5/21/2020
News
IT Leadership in Education: Getting Online School Right
Jessica Davis, Senior Editor, Enterprise Apps,  5/20/2020
Register for InformationWeek Newsletters
Video
Current Issue
Key to Cloud Success: The Right Management
This IT Trend highlights some of the steps IT teams can take to keep their cloud environments running in a safe, efficient manner.
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll