Icahn Enterprises LP, underneath strain from a brief vendor, fell as a lot as 20% after disclosing that federal prosecutors had reached out looking for info.
It additionally launched a letter responding to claims by brief vendor Hindenburg Analysis in essentially the most element but since Icahn’s inventory got here underneath scrutiny Might 2. It mentioned it had “the liquidity, the technique and the know-how” to combat the investor.
Earlier than that assertion, Icahn Enterprises mentioned in a submitting Wednesday that the US Lawyer’s workplace for the Southern District of New York was “looking for manufacturing of data referring to it and sure of its associates’ company governance, capitalization, securities choices, dividends, valuation, advertising supplies, due diligence and different supplies.”
Icahn Enterprises mentioned it was cooperating with the request and offering paperwork.
“The US lawyer’s workplace has not made any claims or allegations in opposition to us or Mr. Icahn with respect to the foregoing inquiry,” the corporate mentioned.
A spokesman for the US lawyer’s workplace declined to remark.
Icahn Enterprises fell 20% to $30.72 at 11:22 a.m. in New York buying and selling Wednesday, giving it a market worth of about $11.3 billion.
“We imagine that we preserve a powerful compliance program and, whereas no assurances might be made and we’re nonetheless evaluating the matter, we don’t presently imagine this inquiry could have a fabric affect on our enterprise, monetary situation, outcomes of operations or money flows,” the corporate mentioned.
The information got here as Icahn Enterprises reported first quarter earnings, with Chief Government Officer David Willetts saying it stands behind its fundamentals. Icahn didn’t seem on the decision.
Hindenburg mentioned Might 2 that Icahn Enterprises’ worth is inflated by 75% or extra, noting that it trades at a premium of greater than 200% to its internet asset worth. Different closed-end holding firms together with Dan Loeb’s Third Level and Invoice Ackman’s Pershing Sq. commerce at reductions to their NAV.
In a press launch responding to Hindenburg Wednesday, Icahn mentioned that the corporate’s NAV use “normal trade valuation strategies” and that it was assisted by third-party consultants.
Icahn mentioned that that evaluating Icahn to Loeb’s and Ackman’s closed-end funds is like “evaluating apples to oranges” since Icahn mentioned he doesn’t cost charges to buyers.
“There isn’t any comparability between our activist technique and working companies and the closed-end funds managed by others,” the corporate mentioned.
Icahn, in his regular brash model, additionally took some pictures on the brief vendor. “Hindenburg Analysis, based by Nathan Anderson, could be extra aptly named Blitzkrieg Analysis given its techniques of wantonly destroying property and harming harmless civilians,” he mentioned.
Anderson didn’t instantly reply to a request for remark.
