Tougher Than the Rest

No longer does Raider Carl Icahn merely take the money and run

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Not so long ago, Carl Icahn looked like just another face in the rogue's gallery of corporate raiders, the types who bad-mouth managers but seldom seem to spend an honest day's work trying to renovate the companies they attack. Yet lo and behold, this widely feared raider is proving a breed apart from the other fast-buck operators. He rolls up his sleeves. Icahn, 51, is a quick learner who is imposing his no-frills ethic on some of the largest and most troubled U.S. corporations. Right now, the unflappable Icahn (estimated net worth: $700 million) is simultaneously juggling three daunting turnaround projects: the born-again TWA, the bankrupt Texaco and the resurgent USX. Icahn's demonstrated management know-how has made him perhaps the most credible of U.S. raiders, one whose spartan style of running a company is both inspiring and chilling for corporate America.

The stakes of Icahn's ventures keep getting larger and riskier. Last week Texaco, in which Icahn holds an interest of nearly 15%, said it lost an astronomical $4.4 billion last year, mainly because of its $3 billion payout to settle an epic takeover dispute with Pennzoil. Yet Texaco's loss might have been far larger had it not agreed to a compromise settlement of Pennzoil's $10.3 billion claim -- a break in the stalemate that Icahn helped bring about. Now Icahn is locked in a struggle with Texaco's management over how to restructure the company and bring it back from bankruptcy. Observes Paul Tierney, a founder of Coniston Partners, a New York City takeover firm: "When Carl goes after something, you can be pretty certain he'll pursue it to the death."

One room in Icahn's midtown Manhattan offices, decorated with framed stock certificates of the companies he has profitably raided, testifies to his conquests. Among the hunter's trophies: American Can, Simplicity Pattern, Hammermill Paper and Marshall Field. It is a display that would make many of his corporate victims cringe, especially the many who lost their jobs when companies were restructured as a result. Yet Icahn's headquarters is no temple to fast money, like the vaulted office of the reptilian Gordon Gekko in the movie Wall Street. Instead, it serves as a model for the unglamorous way he thinks business should be conducted. The only frill in his office is a Persian rug. Icahn manages his frenetic investment ventures with a staff of just eight, who scurry about their nondescript cluster of offices with no pretensions of power, eat lunch at their desks and do not bother to use intercoms. Says Office Manager Gail Golden: "We holler back and forth."

Just as unstuffy is Icahn's partner, Alfred Kingsley, a burly analytical wizard whose tiny office is buried in financial documents. "I know exactly where everything is -- unless somebody moves the paper. Then there'll be a crisis." Somehow Icahn's operation remains efficient despite the increasingly complicated latticework of his investments. Icahn raises money through an array of partnerships bearing such names as Aero Limited, Crane, Pelican and Condor. He changes the titles frequently so that his competitors cannot easily follow his activities in the market. To play, new investors must kick in a minimum of $100 million. But as Icahn told TIME, "No matter how much money they give me to invest, I won't let them look over my shoulder."

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