Icahn seeks management of Southwest Gasoline, begins board battle

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NEW YORK — Carl Icahn on Thursday stated he was making an attempt to realize management of Southwest Gasoline Holdings’ board and exchange its chief govt, because the Nevada utility is transferring ahead with a deliberate acquisition that the billionaire activist investor says hurts shareholders.

“We’re as we speak saying our intention to launch a proxy contest to exchange the complete board and begin a young provide for any and all widespread shares at $75 per share in money,” Icahn wrote to the Southwest board in an open letter.

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The inventory value closed at $69.49 on Thursday.

In an announcement late on Thursday, Southwest stated the board will evaluate the provide when Icahn Enterprises presents it.

Icahn, who holds a just below 5% stake in Southwest, plans to call two or three individuals who work for him and discover different utility trade consultants to function director candidates, two sources acquainted with Icahn’s considering stated.

“With regard to Icahn’s intention to appoint a full slate of administrators for election at Southwest Gasoline Holdings’ 2022 annual assembly of stockholders, the corporate will reply if and when he does,” Southwest added in its response.

Information of the deliberate tender and proxy contest comes solely hours after the corporate on Monday adopted a shareholder rights plan, generally referred to as a poison tablet, to stop any investor from proudly owning greater than 10% of the corporate.

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Final week Southwest agreed to purchase Questar Pipelines from Dominion Vitality for $1.54 billion in money and assuming $430 million in debt, a transfer Icahn has criticized.

Icahn stated he worries the corporate will difficulty inventory at “ridiculously low costs to ‘cherry picked’ associates who can be blindly supportive of CEO John Hester.”

“An important legal responsibility to the corporate is John Hester and his administration staff, we’re engaged on placing collectively a blue ribbon board and administration staff,” Icahn stated in a phone interview, including that in his view Hester was taking part in roulette with shareholders’ cash.

Icahn has spent a profession tangling with corporations and historically asks for just a few board seats when he thinks companies must be run higher. He typically settles with the corporate after which steps apart as his chosen administrators change into concerned in operations.

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At Southwest, nevertheless, the 85-year-old investor is transferring extra aggressively, partly as a result of he felt insulted by Hester and his staff.

“Administration violated our gents’s settlement by saying a poison tablet on Monday,” Icahn wrote within the letter. He added that he was pushing forward with the tender provide to offer all shareholders another choice in addition to what the corporate was proposing.

The state of affairs at Southwest mirrors Icahn’s actions at oil refiner CVR Vitality, the place he gained management in 2012 after shareholders accepted his takeover provide. At CVR, the CEO stayed on.

(Reporting by Svea Herbst-Bayliss in New York, Further reporting by Arathy S Nair, Jahnavi Nidumolu in Bengaluru and David French in New York; Enhancing by Shailesh Kuber, Rosalba O’Brien and Krishna Chandra Eluri)