Carl Icahn sees ‘no reason to persist’ with Apple buyback proposal

Today Carl Icahn released the following open letter to shareholders of Apple Inc.:

Dear Fellow Apple Shareholders,

While we are disappointed that last night ISS recommended against our proposal, we do not altogether disagree with their assessment and recommendation in light of recent actions taken by the company to aggressively repurchase shares in the market.

In their recommendation, ISS points out, and we agree, that “on the spectrum of options for allocating capital, the board appears to have been sluggish only in returning excess cash to shareholders,” and even though the company has in place “one of the largest buybacks in history” we agree with ISS that this effort seems “like bailing with a leaky bucket” when “given the scale of the company’s cash reserves.”

That being said, we also agree with ISS’s observation, taking into account that the company recently repurchased in “two weeks alone” $14 billion worth in shares, that “for fiscal 2014, it appears on track to repurchase at least $32 billion in shares.” Our proposal, as ISS points out, “thus effectively only asks the board to spend another $18 billion on repurchases in the current year.”

As Tim Cook describes them, these recent actions taken by the company to repurchase shares have been both “opportunistic” and “aggressive” and we are supportive. In light of these actions, and ISS’s recommendation, we see no reason to persist with our non-binding proposal, especially when the company is already so close to fulfilling our requested repurchase target.

Furthermore, in light of Tim Cook’s confirmed plan to launch new products in new categories this year (in addition to an exciting product roadmap with respect to new products in existing categories), we are extremely excited about Apple’s future. Additionally, we are pleased that Tim and the board have exhibited the “opportunistic” and “aggressive” approach to share repurchases that we hoped to instill with our proposal. It is our expectation that Tim and the board continue to exhibit this behavior as fiduciaries to the shareholders since they clearly seem to agree that our company continues to be extremely undervalued, and we all share a common optimism with respect to the company’s bright long term future.

Sincerely yours,

Carl C. Icahn

Source Shareholders’ Square Table

MacDailyNews Take: Buh-bye, Carl.

Icahn’s stake is “large” to him, not to Apple. To Apple, it’s a drop in the ocean. So, while he can squawk on Twitter and other media, less than a quarter of one percent doesn’t buy him a lot of financial leverage to “force” Apple to do anything beyond a yawn. At 0.22%, he’s lucky Tim even bothered to pick up the phone.MacDailyNews Take, August 14, 2013

Carl Icahn isn’t rich enough to affect Apple.MacDailyNews Take, November 15, 2013

Related articles:
New York City Comptroller to urge Apple investors to vote against Icahn’s buyback proposal – February 10, 2014
Proxy advisor: Apple shareholders should reject Carl Icahn’s buyback proposal – February 7, 2014
CalPERS criticizes ‘Johnny come lately’ Icahn’s push for additional Apple buybacks – December 12, 2013
Carl Icahn ups Apple stake to $3.6 billion, reiterates calls for larger stock buyback – January 24, 2014


  1. Just a lesson to be learned here. When you join together and put up a united front you can stop a bully. It doesn’t matter how powerful they are as long as you stick together and keep the moral high ground.

    It might be costly, Icahn has been getting away with this for years and so did the likes of Adolf Hitler but at the end decency prevailed.

    It’s a heads up because we are seeing how depraved the United Hates is becoming towards the free world. Their people may decide to join together and regain the moral high ground but right now one has to be pretty blind to see them as anything else but a morally bereft terrorist state. As they move more and more to becoming a threat to global security they day may come where it will be required to put the bully nation in its place.

  2. I really doubt Apple’s board commitment to have aggressively buy back when its share prices were down below $500. I for one like to thank Carl for pushing Apple’s board to take an active interest in how it’s share price is shorted to cream off the long term investors.

    Imagine how much Apple could have saved if they were similarly aggressive when Apple’s share price was around $380 last year; and maybe it would not have crashed so low in the first place.

      1. How can you be happy with Apple performance in 2013? I am an Apple fan, user and a shareholder. I hate it when the likes of Google are doing so well and Apple with the best products failed in 2013. We loyal Investors deserve more management attention.

        It is not sufficient to just ignore those who manipulate the market and Apple’s share. The board requires a financial savvy member and to formulate a better strategy and when possible opportunistic response to manage its cash hoard.

        I personally prefer Apple to invest in one or more of many content distributors and move into new areas but failing that then using the cash to punish short sellers is a good way to ensure long term investors are rewarded for their loyalty and patience.

        Putting one’s head in the sand while the Wall St guys fleece the Apple’s shareholders is not a responsible act.

        1. “…Apple with the best products failed in 2013.”

          Uh, they “failed’? What?!?! They did not kill it last year, but they did fine. Not anywhere close to fail. As in revenue, profit, and products. That is, the important stuff for a company.

          The stock price may have “failed”, but stock price is not linearly linked to the actual performance of a company. Maybe it should be, but it isn’t.

          “I personally prefer Apple to invest in one or more of many content distributors..”

          Invest in companies that are competing against them for distribution of content? Again, what?!?!

    1. Sure…we have Icahn to thank…not!

      Icahn is just an a-hole looking to save face when confronted and also take credit for the recent actions of Apple’s board. Apple had already set the stage with this massive buyback with the $60B plan. Icahn had nothing to do with it.

  3. Carl you chicken shit greedy motherfucker, couldn’t stand to lose face in view of a majority vote to trash you and your selfish motivation, huh?

    Go find another fat cat to parasite on you brainless leech , that destroyed TWA.

  4. Fsck you, Carl. No more buybacks in the near or distant future. Be a man and take your losses like the rest of us Apple shareholder slobs. Any more cash Apple spends needs to go immediately into building its own search engine with Google as the bullseye.

  5. Ican is just trying to save face! WTH is he talking about “only 18B remaining in our request”? This is just apple following thru on their original stated buyback. He wanted an addl 50B on top, which he now knows is not going to happen. Does he think we are dumb enough to think APPL caved to his demands and only fell 18B short? Please!!! Take your ball and go home foolish little man…

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.