Icahn descends on WestPoint Stevens
May 24, 2004-- Home Textiles Today,
New York — Creating an unwelcome and potentially thorny issue for WestPoint Stevens as it works its way through Chapter 11, maverick corporate raider Carl Icahn, an icon of Wall Street financial engineering, has bought a chunk of the major mill’s debt, putting him in a position to try to wrest control of the company.
M.L. 'Chip' Fontenot, WestPoint CEO, confirmed that Icahn had acquired a portion of the company’s second-lien debt.
Bob Mitchell, an associate of the investor at New York-based Icahn and Co., would say only, 'We don’t comment on things like that.'
Lester Dupuy Sears, WestPoint chief financial officer, declined to put a specific value on the Icahn holding. 'It’s not a major piece of the debt. It’s not that large a position,' he said.
Has Icahn signed on as a passive investor, or is he likely to take a more active role at some point? 'There’s really no way to tell,' said Fontenot. 'There are a lot of people with a lot of money who are chasing this company. Clearly, they must believe what we’ve known all along — this is a very good company with a very bright future.'
Icahn, an archetypal 'vulture' investor, has specialized over the years in buying controlling stakes of bankrupt or troubled companies, fixing them up, often by slashing operations and costs, and then flipping them, creating a windfall profit for himself in the process. WestPoint is only one component of an Icahn portfolio that in recent years has included stakes in Sands Casino Hotel and XO Communications Inc. He is reported to be in the process of corralling a major stake in Federal Mogul Corp. In a recent high-profile deal, Icahn acquired embattled carrier TWA, later selling it to American Airlines.
Over the years, Icahn has developed a persona as a particular kind of Wall Streeter, one more interested in opportunistic hits than the building or operation of companies. He is frequently compared to the Gordon Gekko, 'Greed is Good,' character at the center of the Oliver Stone movie 'Wall Street.'
Related Content By Author
Industry Related Content
More From the NY Market: It's All About Product!