Whenever Motorola is mentioned Carl Icahn involvement is soon to follow. Maybe it’s his increasing stake in the company, in which yesterday it was reported that he upped his holding of Motorola to 7.6% from 6.4%, or is it the belief that Carl Icahn being can still help turnaround Motorola?
Even though Icahn dropped a proxy battle with Motorola in mid-April in lieu of two board seats, shareholders are still hoping this corporate raider can turn into a shareholder activist. His increasing stake is a surefire indicator that he sees value in Motorola, and willing to continue to pressure Motorola to make changes this time within the boardroom.
The reasoning I see behind the increasing stake in Motorola is that when the company plans to split, shareholders will likely be able to own stock in both of the new companies’ tax free. Since Icahn is one of the largest shareholders in Motorola he can benefit the greatest from the split.
Carl Icahn has a long road ahead of him with this turn around and I still consider Motorola the worst investment I have ever made. However, since I’m fully invested and not willing to sell resulting in a loss I can only trust Icahn to take this failing cellular phone company and produce two profitable companies in the coming years.
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