Icahn's response: This report is "self righteous"

According to Caixin News Agency, on Tuesday Eastern Time, a well-known US short selling firm, Hindenburg Research, released a report stating that it is shorting Icahn Enterprises (IEP) because the company is clearly overvalued, and more importantly, IEP relies on a "Ponzi scheme style" structure to pay stock interest.

Specifically, Hindenburg Research stated in its report that IEP's stock is overvalued by over 75%, "IEP's trading price is 218% higher than the net asset value reported last time, far higher than all comparable companies."

Hindenburg believes that the foam of IEP stock is driven by its dividend yield of 15.8%, which is the highest among large stock companies in the United States so far. Hindenburg accused Icahn of distributing dividends in the form of stocks rather than cash, and asked IEP to sell new shares to meet shareholder expenses, thereby increasing dividend yields.

In short, Hindenburg accused IEP of constantly "robbing Peter to pay Paul" and creating the illusion of making money. Hindenburg believes that Icahn, a legendary figure on Wall Street, made a typical mistake of using too much leverage in the face of sustained losses, and this combination rarely yields good results.

Regarding the allegations of the Ponzi scheme, Hindenburg pointed out that IEP's dividends are mathematically unsustainable. Since 2014, despite poor performance and negative free cash flow of $4.9 billion, Icahn has paid $1.5 billion in cash dividends.

On the same day, Carl Icahn responded that Hindenburg released this "self righteous" report aimed at gaining profits at the expense of long-term shareholders. We insist on publicly disclosing information and believe that in the long run, IEP's performance will remain self-evident as before.

According to First Financial, Wall Street has never lacked a wolf like personality, and investment tycoon Carl Icahn, who gallops on Wall Street, is known as the "wolf king". Talking about this name in the early years can make CEOs of American listed companies tremble with fear.

Icahn's once most convenient malicious acquisition method may not be tolerated by regulatory or government agencies today, and many institutions and investors who have tasted the sweetness are facing criminal investigations.

In 1985, Icahn forcibly acquired Global Airlines (TWA), one of the four major airlines in the United States, through a malicious acquisition. After acquiring over 20% equity and becoming chairman, Icahn began to spin off TWA's assets. In 1988, Icahn acquired TWA through management, earning a personal profit of $469 million, but leaving the company with a huge debt of $540 million. In the 1987 Oscar winning film "Wall Street," Michael Douglas played a protagonist partially based on Carl Icahn.