Hindenburg Research Shorts Billionaire Carl Icahn After Adani And Jack Dorsey’s Block

Hindenburg Research now has a new target. After creating havoc with short positions on Gautam Adani-led Adani Group and Jack Dorsey’s Block, Hindenburg Research now has a short position in billionaire Carl Icahn-led Icahn Enterprises. 

Taking to Twitter, Hindenburg announces: “NEW FROM US: Icahn Enterprises—The Corporate Raider Throwing Stones From His Own Glass House.” It mentions that Icahn Enterprises is an $18 billion market cap holding company and Carl Icahn and his son Brett, own approximately 85 per cent of it.

For the unversed, Icahn Enterprises is reportedly considered to be one of the most successful activist investment firms. However, due to this report by Hindenburg, alleging a myriad of wrongdoings, the Carl Icahn-led firm’s shares fell nearly 10 per cent in the premarket trading. 

In its report on Carl Icahn, Hindenburg Research has alleged that Icahn was operating a “ponzi-like economic structure,” by selling its units to new investors – all in order to support its dividend payouts. The report reads, “In brief, Icahn has been using money taken in from new investors to pay out dividends to old investors. Such ponzi-like economic structures are sustainable only to the extent that new money is willing to risk being the last one ‘holding the bag’.”

Overall, the Hindenburg Research report on the Wall Street legend also reads, “Overall, we think Icahn, a legend of Wall Street, has made the classic mistake of taking on too much leverage in the face of sustained losses: a combination that rarely ends well.”