Carl Icahn’s new blog, The Icahn Report, takes on Corporate America. He says, “Poor corporate governance now threatens more than just potential shareholder value; it threatens this country’s very economic structure.” Icahn’s flair for the dramatic and proactive fight for shareholders’ interests has kept him in the news.
Icahn most recently lost a proxy fight with Biogen Idec by a “comfortable margin,” according to The Wall Street Journal. A rare defeat for the billionaire activist, the vote demonstrated confidence in Biogen’s management after relaunching a multiple-sclerosis drug, Tysabri, which was initially recalled due to safety concerns.
Icahn argued that Biogen could do better and he offered to purchase the company for more than $23 billion. Icahn holds 4.3 percent stake in the company. He later withdrew his bid when no other pharmaceutical companies bid on Biogen. Icahn argued that Biogen’s sale process was designed to ward off bidders and nominated three people to the companies 12-member board, according to the WSJ.
“Poor corporate governance now threatens more than just potential shareholder value; it threatens this country’s very economic structure.”
- Carl Icahn
Icahn’s position may have been supported by major shareholders, however it did not persuade other holders after RiskMetrics Group backed Biogen. Biogen’s nominees were elected. Whether the company is eventually sold remains to be seen.
A minor setback, Icahn believes that because of incompetent boards, today’s economy is now in major crisis. “It is the top level management that hangs like an albatross around the company’s neck,” he says, “When you rid a company of fruitless boards, the rewards are often enormous because the underlying company and its employees can be excellent.” Icahn plans to continue his quest to fight boards and unlock the underlying talent.