Icahn Looks to Boost Time Warner Stake

NEW YORK, August 17: Billionaire investor Carl Icahn, who
embarked on an aggressive mission to restructure Time Warner early this year,
is forming a new fund for the sole purpose of investing in the media
conglomerate, according to the New York Times.

The Times reports that Icahn sent a letter to investors in
Icahn Partners—Time Warner accounts for about 27 percent of the fund’s
investments—earlier this week detailing plans for a “special purpose
vehicle” to invest in Time Warner. “Time Warner’s stock has proven frustrating,
but we continue to hold the stock and feel, as strongly as ever, that a
significant gap exists between Time Warner’s intrinsic asset value and its
share price,” he wrote in the letter. “Every once in a while, markets act
irrationally, providing the patient investor with great opportunities for
reward with little risk. RJR Nabisco was a good example of this—over the
course of a few years, I made many times my investment. Today I believe Time Warner
represents such a situation.”

Icahn currently controls about 1.5 percent of Time Warner.
It is not clear how much more of the company he is looking to acquire.

In February of this year, Icahn waged a campaign to have
Time Warner broken up into four different entities, and Richard Parsons removed
as chairman and CEO. Lacking significant support for the move, Icahn reached an
agreement with Time Warner. The company agreed to increase its share repurchase
program and extend the program’s end date. And, it committed to a cost-cutting
review that will add another $500-million in cost cuts in 2007 to that planned
for this year.