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Carl Icahn, founder and majority shareholder of Icahn Enterprises, has acquired an over 8% stake in Crown Holdings (NYSE: CCK), reports the Wall Street Journal. This makes Icahn Crown the second largest shareholder of Icahn Crown with a stake of over $700 million.
The activist investor, who recently made hundreds of millions of dollars betting that Elon Musk would buy Twitter at the original price, believes Crown should dump non-core units and buy back more shares, the report adds. Crown should either separate or sell its non-core assets, according to Icahn. In this way, the company could fully concentrate on its core beverage can business.
Crown shares are down nearly 40% year-to-date after last week’s plunge. The company has significantly reduced its full-year earnings outlook so it now expects to earn between $6.60 and $6.70 per share, down from the previous range of 8, 00 to $8.20.
CEO Timothy Donahue admitted on the earnings call that Crown had been caught off guard by “such a sudden and sharp decline” in demand for beverage cans.
“You never like to say, we’re caught off guard, but I think we really were,” Donahue said on last week’s conference call.
By Senad Karaahmetovic