Bil­lion­aire Carl Ic­ahn Sells En­tire Stake in Ap­ple

Ic­ahn is con­cerned with bar­ri­ers to trade that China’s au­thor­i­tar­ian regime might put in place

The Economic Times - - Around The World -

New York: In an in­ter­view with ca­ble tele­vi­sion net­work CNBC, Ic­ahn also said he was “still very cau­tious” on the US stock mar­ket and there would be a “day of reck­on­ing” un­less there was some sort of fis­cal stim­u­lus.

Ic­ahn had been a huge cheer­leader of Ap­ple, ac­quir­ing a stake in the com­pany al­most­three­yearsago,re­peat­ed­ly­call­ing the in­vest­ment a “no brainer.” In an open let­ter to Ap­ple CEO Tim Cook in May 2015, Ic­ahn had ar­gued that shares of the iPhone maker were worth $240, about 90% more than they had been trad­ing. At $240 a share, Ap­ple’s mar­ket cap would be $1.4 tril­lion, Ic­ahn as­serted. But Ic­ahn, who owned 45.8 mil­lion Ap­ple shares at the end of last year, said China’s eco­nomic slow­down and wor­ries about how China could be­come more pro­hib­i­tive in do­ing busi­ness trig­gered his de­ci­sion to exit his po­si­tion en­tirely.

“We no longer have a po­si­tion in Ap­ple. Tim Cook did a great job. I called him this morn­ing­totell­himthatand­he­wasalit­tle sorry, ob­vi­ously. But I told him it’s a great com­pany,” Ic­ahn said. “In Ap­ple to­day as op­posed­tosix­month­so­rayear­ago,inthis one, there’s no need for ac­tivism be­cause I think they have a great man­age­ment. But you worry a lit­tle bit, maybe more than a lit­tle, about China’s at­ti­tude.” The Chi­nese gov­ern­ment could “come in and make it very dif­fi­cult for Ap­ple to sell there. You can do pretty much what you want there,” Ic­ahn said. Ear­lier this month, China shut down Ap­ple’s iTunes moviesandiBooks­storeswith­inthe­coun- try, fol­low­ing Beijing’s in­tro­duc­tion of reg­u­la­tions in March im­pos­ing strict curbs on on­line pub­lish­ing, par­tic­u­larly for for­eign firms. Asked when he might get back in, Ic­ahn re - plied: “I don’t think it’s the price point. I think it’s my opin­ion about what is hap­pen­ing with China. I think the stock is very cheap on a mul­ti­ple ba­sis. China could be a shadow for it, and we have to look at that.” Ic­ahn, who sug­gested that he made roughly $ 2 bil­lion off the Ap­ple trade, said he was in Ap­ple for about three years and “if you bought the stock then, you got a 48% to 50% to­tal re­turn. We

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Ap­ple shares came un­der fur­ther sell­ing pres­sure dur­ing Ic­ahn’s tele­vi­sion in­ter­view, as did the Dow Jones in­dus­tri­als with Ap­ple clos­ing down over 3% at $ 94.83. The Dow ended down by 210 points. Ap­ple on Tues­day posted its first de­cline in iPhone sales as well as its first rev­enue drop in 13 years. The com­pany’s sales fell by more than a quar­ter in China, its most important mar­ket af­ter the United States, and it fore­cast an­other dis­ap­point­ing quar­ter for global rev­enues. Ap­ple shares have now de­clined more than 10% this week.

The Chi­nese gov­ern­ment could make it very dif­fi­cult for Ap­ple to sell there

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