2023-07-10 07:40:56 ET
Icahn Enterprises LP ( NASDAQ: IEP ) stock climbed 9.2% in Monday premarket trading after a report that activist investor Carl Icahn has disconnected his personal loans from the price of his company's shares.
IEP's shares had dropped ~40% in the past two months after a short seller, Hindenberg Research , sounded warnings over the ties between Icahn's personal loans and his company's shares. The short report alleged that the price of the publicly traded units are "inflated."
With the value of Icahn's collateral against the loans dropping, lenders then became alarmed and sought more collateral. After months of negotiating with the banks, Icahn amended his loan agreements on Sunday, severing his personal loans from the price of Icahn Enterprises ( IEP ) units, increasing his collateral, and setting up a plan to fully repay the loans in three years, the Wall Street Journal reported Monday.
Under the amended agreement, the only situation that would trigger a margin call would be if the net asset value of this company's investments, which include companies and stocks, significantly slides.
Carl Icahn owns ~85% of IEP, which had a market value of $18B before the short report and $10.7B as of Friday. About 60% of his shares were put up as collateral for the personal loans, the WSJ said.
More on Icahn Enterprises stock movement:
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Icahn Enterprises: Likely To Go Lower; Various Arbitrage Trades Available
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Icahn Enterprises stock soars, gains most in more than a month
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Icahn Enterprises looked at asset swaps, fundraising before short call - report
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Icahn Enterprises tumbles 14% amid salvo from Bill Ackman
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Icahn Enterprises: Thanks For The Early Retirement, Hindenburg
For further details see:
Icahn Enterprises stock jumps after Icahn renegotiates personal loans - report