Carl Icahn unties personal loans from IEP's share price- WSJ (updated)

Iep Invest NV

10/07/2023 08:14

(Adds details from the WSJ report and background from
Hindenburg's May reports in paragraphs 2-4 and 6, shares in
paragraph 5)
       July 10 (Reuters) - Carl Icahn and banks have finalized
amended loan agreements that untie Icahn's personal loans from
the trading price of Icahn Enterprises  IEP.O , months after
short-seller Hindenburg flagged margin call risks, the Wall
Street Journal reported on Monday.
    Among other concerns, Hindenburg had in May called Icahn's
pledge of about 60% of his IEP stake as collateral for margin
loans a risky form of financing that could result in margin
calls should unit prices decline.
    Icahn has now agreed to provide additional collateral, which
will total roughly $6 billion including $2 billion of his funds
and laid out a plan to repay the loans in three years, the
report said, citing people familiar with the matter.
    The billionaire will pay banks $500 million in September,
make eight quarterly payments of $87.5 million beginning a year
after that, and then pay the balance $2.5 billion three years
from now, the Journal added.
        Shares of IEP are down more than 40% since Hindenburg
disclosed its short position.
  
        Hindenburg accused IEP of overvaluing its holdings and
relying on a "ponzi-like economic structure" to pay dividends
and said that IEP units were inflated by more than 75%.
  
        IEP did not immediately respond to a Reuters request for
comment. 
  

 (Reporting by Gursimran Kaur in Bengaluru; Editing by Dhanya
Ann Thoppil)
 ((GursimranKaur.Mehar@thomsonreuters.com;))