Carl Icahn is a legendary figure in the world of investment and business. As a highly successful and influential investor, he has a remarkable ability to spot potential in various companies and transform their business models. His involvement in the development of Apple and Netflix are prime examples of his impact. Icahn founded his own investment firm and remains one of the wealthiest people globally. Learn more about how a regular kid from New York became a billionaire on newyork1.one.
Family and Education
Carl Icahn was born in New York City on February 16, 1936. His mother was a teacher, and his father was a cantor at a synagogue. The family lived quite modestly. Carl grew up in a Jewish household, though his neighborhood was ethnically diverse.
Carl was a diligent student and excelled in school. After finishing high school, he decided to apply to the country’s top universities. No one, not even his parents, believed in his success. Yet, the persistent young man was accepted into Princeton University. There, Icahn earned a bachelor’s degree and then enrolled in the New York University School of Medicine, aspiring to become a doctor.
During his studies, he often played poker with his classmates to earn money. Carl never lost and always found winning strategies. He soon abandoned the idea of a medical career and, in 1959, joined the Army Medical Center. After this stint, Icahn began his brokerage career.
Carl Icahn on Wall Street
Carl Icahn’s first job on Wall Street was at a brokerage firm, where his uncle recommended him. He became a broker at “Dreyfus & Company” in 1961 and quickly showcased his talent. Icahn successfully invested his own money and started earning, but the market crash of 1962 left him without savings.
To recover his losses, he worked almost around the clock. During this period, Icahn became interested in options and began working at “Tessel Patrick and Company.” Here, he met Joseph Freilich and Daniel Kaminer. They started working together. In 1964, the trio joined “Gruntal.” They established an options department and made it profitable in record time.
In 1968, Carl Icahn borrowed a significant sum from his uncle and bought a seat on the New York Stock Exchange. That same year, he founded his own company, “Icahn & Co.,” for trading securities and other financial operations. It was then that the investor developed his strategy of acquiring less successful companies and engaging in corporate raiding.
The general idea was to buy large blocks of shares in companies and then pressure management to change leadership and restructure assets. As a result of these actions, the market value of the shares Icahn had previously acquired would rise, ensuring him very high profits. This scheme was behind the businessman’s biggest deals, through which he amassed billions. In 2016, Donald Trump nominated Carl Icahn as his special advisor on business issues. He was not part of the government, allowing him to continue his usual activities.
Major Deals and Controversial Success
One of Carl Icahn’s biggest investment deals was the takeover of Trans World Airlines (TWA). In the 1980s, the company faced financial difficulties and substantial debt. Additionally, it was losing market share compared to its competitors.
Icahn decided to employ his strategy and, in 1985, began actively buying TWA shares. He soon gained complete control of the company. The businessman’s goal was to restructure debts and sell assets, including planes and valuable routes. One such move was the sale of profitable international routes to competitor “American Airlines.” Icahn made over $400 million from this, but it significantly weakened TWA in the market.
The strategy used by the businessman was sharply criticized by other investors and airline employees. However, they were powerless, as Icahn owned most of the shares, and in 1988, he even took the company private. This gave him full control but did not improve TWA’s situation. In 1992, the airline filed for bankruptcy. In 2001, it merged with “American Airlines,” and Carl Icahn walked away with a substantial profit from his actions.
However, the businessman’s activities weren’t always destructive. For instance, in 2013, he acquired a large stake in Apple and actively participated in its management. Apple was already a well-known company, but Icahn believed that its undistributed cash reserves made its shares cheaper than they could be.
Icahn proposed a stock buyback scheme and pledged to leverage his influence with the media and shareholders. The company agreed to a $90 billion buyback, which boosted its market capitalization and led to a rise in stock prices. Icahn himself profited handsomely from this. In 2016, he sold most of his Apple shares, but his stimulating influence remained an important chapter in the company’s development.
Another intriguing story of Carl Icahn’s activities is linked to Netflix. In 2012, he acquired 10% of the company’s shares, valued at approximately $320 million. Netflix was also facing a complex financial situation and numerous competitors at the time. An attempt to change subscription models resulted in new losses, which didn’t bode well. However, Icahn believed in the company’s future, as its exclusive content was becoming increasingly popular.
This time, the businessman did not actively intervene in the management strategy. Instead, he decided to wait for the stock price to rise to maximize his profit. His expectations were met when Netflix shares surged in value several times over the next few years. The investor then sold his shares and once again reaped a significant profit. In 2015, he earned approximately $2 billion from these transactions, a substantial sum compared to his initial investment.
This story is often cited as one of the most successful deals in Carl Icahn’s career. He had previously demonstrated his ability to foresee the future of companies and accurately assess their market opportunities. This is how the businessman and investor amassed a multi-billion-dollar fortune.
The Personal Life of a Famous Businessman
Carl Icahn first married in 1979 to Liba Trejbal, a ballerina from Czechoslovakia. The couple had two children. Their marriage lasted until 1993 when they decided to divorce.
The divorce process dragged on for six years. Liba sought more money from her husband and also intended to revoke the terms of their prenuptial agreement. According to the document, she was not entitled to claim jointly acquired property. Eventually, Carl and Liba reached an agreement and divorced, but the details were not disclosed.
In 1999, Icahn married a second time. This time, the businessman’s chosen partner was Gail Golden, a broker and his assistant. She also has two children from a previous marriage.
Carl Icahn is also known as a philanthropist. He has made significant financial donations to war veterans and educational institutions. Despite his advanced age, the businessman continues to influence financial markets and the global economy.