Carl Icahn: Motorola’s new backseat driver?

Carl Icahn wants a seat on the board of directors at Motorola Inc., the company acknowledged in a statement.
Icahn and business interests he controls own more than 33 million shares of Motorola stock, about 1.4 percent of the company’s outstanding shares, according to media reports. His possible nomination to the 13-member board-he made his interest known yesterday in a filing-would come at Motorola’s annual shareholder meeting, which has yet to be scheduled.
Motorola said in a statement acknowledging Icahn’s interest that it had no information on Icahn’s intentions. Based on his track record, however, it would be fair to say that Icahn likely would push for significant changes in strategy or management at the handset vendor. Wall Street sent Motorola’s stock up 6 percent on the news in early trading.
Icahn is variously referred to as a “billionaire investor,” “corporate raider” and “activist shareholder.” Essentially, he’s a business man with a lot of money and business savvy who uses both to make more money for himself and shareholders while shaking up companies he sees as undervalued or mismanaged. He is listed as the 24th richest person in America, according to Forbes magazine.
Motorola enjoyed world-beating financials in the first half of last year, but in the fourth quarter the company posted dismal profits on record-setting volumes of handsets. Analysts attributed the company’s decline on low operating margins from handset sales in emerging markets and weakness in sales in developed markets-a reflection of market conditions as well as strategy and execution at the company.
As a result, the vendor announced earlier this month it would cut 3,500 jobs, or about 5 percent of its workforce, to cut costs. A number of analysts-including Albert Lin at American Technology Research and Brantley Thompson at Goldman Sachs Group Inc.-have said that the job cuts reflect Motorola’s view that a turnaround is several quarters away.
Icahn rose to public attention in 1985 with a takeover of Trans World Airlines, which he dismantled and lost control of in 1993; the remnants were purchased by American Airlines in 2001. He has had high-profile investments in, and influence on, a number of well-known companies such as Time-Warner Inc. and is involved in real estate, entertainment, energy, pharmaceuticals and casinos, to name a few endeavors. His own major company is known as American Real Estate Partners.