Icahn Enterprises, a prominent investment firm, faced a significant drop in its stock prices following a disclosure by the Securities & Exchange Commission (SEC). The drop of 23% in regular trading was compounded by an additional 4% decrease in after-hours trading. This sudden decline came after the SEC’s Division of Enforcement contacted Icahn Enterprises on June 21, requesting extensive information on several aspects of the company’s operations.
The SEC’s request included inquiries into corporate governance, capitalization, securities offerings, disclosure, dividends, valuation, marketing materials, due diligence, and other relevant materials. This disclosure from the SEC followed a previous inquiry in May by the U.S. Attorney’s office for the Southern District of New York, which demanded the same information from Icahn Enterprises.
To clarify the situation, Icahn Enterprises stated in its latest filing that neither the U.S. Attorney’s office nor the SEC has made any allegations or claims against the company or its founder, Carl Icahn, in relation to these inquiries. However, the company did announce a reduction of 50% in its quarterly distribution. The distribution, which was previously set at $2 per share, has now been lowered to $1 per share.
Hindenburg Research, the organization that released a short report on Icahn Enterprises in May, commented on the situation. They stated that they had predicted both the reduction in dividends and additional investment losses in their report. Following the SEC contact and the dividend cut announcement, IEP shares experienced a significant decline.
As of now, further developments and updates on Icahn Enterprises’ situation are expected in the near future. The company’s stock prices and performance will be closely monitored by investors and market analysts. It remains to be seen how these inquiries and the subsequent reduction in dividends will impact Icahn Enterprises in the long run.
