Buyback

Carl Icahn folds on Apple buyback proxy fight

February 10, 2014: 10:06 AM ET

He writes in an open letter to Apple shareholders that he sees "no reason to persist."

Screen Shot 2014-02-10 at 9.50.08 AM

Icahn's Oct. 1 postprandial tweet.

FORTUNE --  On Monday, four and a half months after Carl Icahn tweeted that he had "pushed hard" for Apple (AAPL) CEO Tim Cook to use his company's entire cash holdings to buy its own "extremely underpriced" shares, Wall Street's most feared and admired corporate-raider-turned-activist-investor backed down.

Icahn's announcement, made in an open letter to Apple shareholders on his Barbarian-at-the-Gates style newsletter, came the day after an influential proxy-advisory firm came down strongly against his shareholder proposal.

That proposal had already been scaled back (from $150 billion to $50 billion) and declawed (to non-binding status) when Cook pulled the rug out from under it by announcing that Apple had spent $14 billion in two weeks on a buyback spree that brought the company to within $18 billion of Icahn's $50-billion-by-2015 goal -- something it is on track to easily exceed before the end of the year.

But the recommendation by Institutional Shareholder Services was the kiss of death. Apple's buyback rate may seem "like bailing with a leaky bucket" given the size of the company's cash reserves, it wrote, but that wasn't any reason to "micromanage" the company's "good faith efforts."

Icahn promised last summer when he first tweeted that he had taken a "large position" in Apple that he was in the stock for the long haul. Will he tweet to let the market know when he's decided it's time to sell?

LINKS:

  • Tim Cook's 2-week, $14 billion Apple buying opportunity

    While the Street was dumping Apple, Cook -- and Carl Icahn -- were snapping up shares.

    FORTUNE -- Tim Cook's interview in Friday's Wall Street Journal puts the attached Apple (AAPL) stock chart in a new light.

    What looked to human day traders and computer algorithms on Jan. 27 like a signal to sell, Cook saw as a buying opportunity.

    He was surprised, he told the Journal, that Apple's share price fell 8% after the MORE

    - Feb 7, 2014 7:56 AM ET
  • The Icahn effect: Round 3

    He buys, he tweets, he cajoles, and the hearts of Apple traders skip a beat.

    FORTUNE -- Three tweets so far today from Carl Icahn about Apple (AAPL):

    10:50 am: Since tweeting about our large position in $AAPL on Aug 13, when the stock was 468 per share, we've kept buying shares of this 'no brainer.'
    10:50 am: Having purchased $500 million more $AAPL shares in the last two weeks, our investment has crossed the MORE

    - Jan 22, 2014 11:39 AM ET
  • The 'missile' Carl Icahn fired at Apple was more like a love note

    He cut his buyback demand from $150 billion to $50 billion and gave Apple a year to do it.

    FORTUNE -- From the headlines, you would think that Carl Icahn, America's most famous corporate raider, had donned a headdress and gone into his war dance:

    Icahn beats Apple buyback drum (again) with new proposal (CNET)
    Carl Icahn Rallies Apple Shareholders To Demand Stock Buyback (Cult of Mac)
    Carl Icahn ups ante in crusade for Apple buyback (Associated Press)
    Carl MORE

    - Dec 5, 2013 8:07 AM ET
  • Apple's Carl Icahn effect, redux

    A dinner, a tweet, a pop in the market.

    FORTUNE -- He's done it again.

    In August, corporate raider Carl Icahn announced on Twitter that he believed Apple (AAPL) at $470 was "extremely undervalued." He said that he had taken a "large position" in the company, had talked to Tim Cook about accelerating the company's record $60-billion stock buyback program, and would be meeting with Cook to discuss it further.

    On the strength MORE

    - Oct 1, 2013 10:44 AM ET
  • Chart of the day: Apple shares spike suddenly on high volume

    No hard news, just rumors of a large buyback or special dividend

    FORTUNE -- After trading down all day -- and all year, for that matter -- Apple (AAPL) began moving higher at 2:26 p.m. Monday and didn't stop until it hit resistance at $438. The stock closed at $437.87, up $6.15 (1.42%) for the day.

    Wall Street watchers were left scratching their heads.

    "What's up with AAPL?" was the headline on Barrons. "Apple MORE

    - Mar 11, 2013 4:29 PM ET
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