Icahn Lieutenants Don’t Go Overboard

The Wall Street Journal

Liz Hoffman

Sep 18, 2014

Carl Icahn’s people are trying not to go overboard.
Three Carl Icahn lieutenants appointed this week as directors of car-rental agency Hertz Global Holdings Inc.HTZ +0.80% resigned from the boards of companies affiliated with Icahn-controlled CVR Energy CVI -1.55%.
The moves, announced in a securities filing Wednesday evening, come as some large shareholders and proxy advisers like Institutional Shareholder Services have criticized “overboarding,” arguing it stretches directors too thin and can give rise to conflicts of interest.
ISS recommends voting against directors who sit on six or more company boards – or more than two, in the case of sitting chief executives. Asset manager BlackRock Inc.BLK +1.08%’s guidelines call for a maximum of four boards.
Hertz would have been the sixth board seat for Samuel Merksamer, who is also an Icahn-appointed director at Navistar International Corp.NAV -2.41%, Hologic Inc.HOLX -0.32%, Transocean Ltd.RIGN.VX -1.88% and Talisman Energy Inc.TLM.T -1.58% It would have been the fourth for Vincent Intrieri, who sits on the boards of Transocean, Navistar and Chesapeake Energy Corp.CHK -2.80%
Analysts at Gordon Haskett, an event-driven and activist research firm, said Mr. Icahn’s deep bench means this isn’t a problem. Andrew Langham and Louis Pastor, two of Icahn’s in-house lawyers, have already been appointed to fill the CVR vacancies, according to a regulatory filing.
But as the billionaire investor continues to rack up board seats – at least 14 over the past year, at Nuance Communications Inc.NUAN -0.06%, Talisman, Hologic and others – he may have to deploy his most trusted lieutenants judiciously.
“It tells us that there is a recognition that these individuals can only serve on so many boards and it has us wondering whether it has gotten to the point of being a zero-sum game where any new appointments have to be offset by resignations,” Gordon Haskett wrote Thursday. “If so, it will be interesting to see in the future where seats are being relinquished as that could offer insight into where Icahn’s priorities lie.”