Icahn Enterprises Shares Fall After US Attorney’s Office Requests Information

(Bloomberg) — Icahn Enterprises LP, under pressure from a short seller, fell as much as 20% after disclosing that the US Attorney’s office for the Southern District of New York had reached out seeking information.

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Icahn Enterprises said in a filing Wednesday said that the office was “seeking production of information relating to it and certain of its affiliates’ corporate governance, capitalization, securities offerings, dividends, valuation, marketing materials, due diligence and other materials.”

Icahn Enterprises said it was cooperating with the request and providing documents.

“The US Attorney’s office has not made any claims or allegations against us or Mr. Icahn with respect to the foregoing inquiry,” the company said.

Icahn Enterprises fell 20% to $30.36 at 10:42 a.m. in New York trading Wednesday, giving it a market value of about $11.3 billion.

“We believe that we maintain a strong compliance program and, while no assurances can be made and we are still evaluating the matter, we do not currently believe this inquiry will have a material impact on our business, financial condition, results of operations or cash flows,” the company said.

The news came as Icahn Enterprises reported first quarter earnings, with Chief Executive Officer David Willetts saying it stands behind its fundamentals and would issue a report on Wednesday refuting a short-seller report from Hindenburg Research.

Hindenburg said May 2 that Icahn Enterprises’ value is inflated by 75% or more, noting that it trades at a premium of more than 200% to its net asset value. Other closed-end holding companies including Dan Loeb’s Third Point and Bill Ackman’s Pershing Square trade at discounts to their NAV.

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