Stevens Mark - King Icahn: The Biography of a Renegade Capitalist

Mark Stevens

King Icahn

The Biography of a Renegade Capitalist

Research by Carol Bloom Stevens

Dutton

Originally Published by the Penguin Group

Penguin Books USA Inc.375 Hudson Street, New York New York 10014, U.S.A

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First Published by Dutton, an imprint of New America Library, a division of Penguin

Books USA Inc. Distributed in Canada by McClelland & Stewart Inc.

First Printing, June, 1993

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Copyright Mark Stevens

All rights reserved

Registered Trademark MARCA REGISTRADA

Library of Congress Cataloging in Publication Data:

Stevens, Mark, 1947-

King Icahn : the biography of a renegade capitalist | Mark Stevens.

p. c.m

ISBN 0-525-93613-0

1. Icahn, Carl C., 1936- 2. Capitalist and financiers United States Biography 3.Consolidation and merger of corporations United States History. I. Title. HG172.I27S74 1993

338.8 3092 dc20

[ B ] 92-37592

CIP

Printed in the United States of America

Set in Bodoni Book

Designed by Steven N. Stathakis

Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording or otherwise), without the prior written permission of both the copyright owner and the above publisher of this book.

I create nothing, I own.

- Gordon Gekko in the film Wall Street, 1987

Table of Contents

FORWARD: THE BATTLE TO WRITE THIS BOOK

It was the spring of 1992 when Carl Celian Icahn first appeared on my radar screen. I knew of his Wall Street exploits from various news reports but it all became strangely personal when I watched the tall gangly figure Id seen on television walk across the village green of my hometown of Bedford, New York.

My mind raced.

Is that the feared corporate raider dressed in faded tennis shorts and a wrinkled top walking into the village wine shop? Is it just a look alike? If its Icahn, whats he doing here in sleepy Bedford?

I wanted to approach the man but held back, thinking it was likely just another resident of the town who had no interest in or relationship to Icahn. Still, the face seemed to strike a chord, so when I returned home, I called a neighbor who was familiar with all things Bedford. He responded immediately and with absolute certainty.

Oh, Im sure that was Carl. Dont you know he lives here? He has a big placea couple of hundred acresoff Long Meadow. And the clothes that looks like he slept in them? Thats classic Icahn.

Thus began an odyssey that started with a visit to Long Meadow, driving up to the imposing iron gates which piqued my curiosity about the secretive man who lived behind them. Curious about whom he was, where he came from, how much wealth hed amassed and the details on how he made himself one of the richest men in America, I dug into all of the written materials I could find on Icahn.

I discovered that he was a speculator of sorts, a financial genius and a bully, who had managed to go head-to-head with the corporate establishment and force them into taking actions they resisted. In virtually every case, these captains of industry erected firewalls of lawyers to protect their positions, did everything possible to intimidate Icahn but in the end they would fold or otherwise cede to his demands and in doing so would line his pockets with tens or hundreds of millions of dollars. I began to think of Icahn as a Rhodesian ridgeback, who leapt onto corporate CEOs, clamped his teeth into their jugular veins and took them down as his prey.

The written material on his deals was rather thin and sketchy and most intriguing to me, there was nothing to speak of on his m.o., what made Icahn tick, where he came from, who backed him, why he lived in Bedford, his family life (if he had one). Given that he was becoming a major force in American business, a feared name in executive suites, the absence of a more detailed flesh and blood portrait of the man seemed odd.

And something I was determined to change.

It was then that I managed to secure his home telephone number and placed a call to the Long Meadow estate. Surprisingly, he answered the phone himself.

Carl, this is your Bedford neighbor Mark Stevens.

In the silence, I could hear him thinking, Who the hell is Mark Stevens.

If this is about the horses, Carl finally blurted out, clearly irritated, my decision is final. No horse trails on my property.

Bedford is an equestrian paradise, boasting an extensive riding trail system. It is common practice in town, a cornerstone of local etiquette, to allow your fellow Bedfordites to ride through your property. But Icahn is never one for etiquette, especially the rules of an exclusive WASP club that he would rail and tilt against his entire life.

Nothing to do with horses, I said. No, Im going to write a book about you and thought you should know that....and perhaps allow me to interview you.

Again a stony silence. One I allowed to linger like an unwanted guest.

Absolutely not, Icahn finally retorted.

You wont grant me an interview?

Thats not what I mean.

So will you be so kind as to explain what you mean?

I knew from my early research that Icahn was hardly the kind type but I was playing nave in what I knew would be a challenging negotiation.

Icahn grew quickly impatient You dont get what Im saying....whatever your name is.

And youre saying what?

That there will be no book. Zero. Nada. Get the idea out of your head.

Time for me to play raider.

There, you are wrong, Carl, I said calmly, intentionally addressing him by his first name. I am writing your biography, with or without you.

Silence. Then a flame of palpable anger from Mr. Icahn.

If you as much as write a single sentence, I will sue you so mercilessly, so extensively, that youll be forced to turn to soup kitchens for your meals.

Whoa, so neighborly of you Carl.

I waited ten seconds or so to toss out the first shot across his bow.

OK then, I hope youll at least attend the publishers party when the book is published.

Thus began a five-month, see-saw battle that featured a non-stop barrage of threats, late-night phone calls, all manner of intimidation and what I was warned were imminent legal actions. But two absolutes remained fixed in place: I was determined to write the book and Icahn was determined to stop me.

In the midst of this sideshow, I had already started interviewing a menagerie of Wall Street playerslawyers, investment bankers, arbitrageurs and proxy firmsmany of whom had little or no love for Icahn. In fact, whether it was based on jealousy or his ruthless tactics, they detested him.

As one M&A chief put it:

Carls dream in life is to have the only fire truck in town. Then when your house is in flames, he can hold you up for every penny you have.

In the midst of our marathon talksvirtually all initiated by Carl leveling one threat after anotherI made it clear that if he didnt cooperate, his side of the story would never make it into the narrative. But because he was certain that he could quash the book in its tracks, this never seemed to alter his calculus.

Until he called me one night at 2:43 am

Look Stevens, why dont we do the book as partners?

Bingo. Breakthrough. Or so I thought.

Carls idea was to create a partnership agreement whereby he would commit to a tell-all about his life and in return he would share in the advance and royalties 70/30, with guess who laying claim to the 70 percent. Of course I objected and after weeks of wrangling over a fair deal, we moved from 70/30 to 65/35 to 60/40 to 58/42 to 55/45 and ultimately to the only split I would agree to: 50/50.