12.08.2012

Icahn has another go

Carl Icahn is pushing JLG’s owner Oshkosh - in which he controls a nine percent stake - to spin off the telehandler and access manufacturer into a separate company.

Representatives of Icahn’s various investment groups are reported to have held talks with Oshkosh management on August 9th.

Icahn believes that JLG is undervalued as part of Oshkosh and that this is unlikely to change anytime soon. He is also said to be of the opinion that JLG would perform better as a stand-alone businesses.

See Oshkosh wins the day
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Carl Icahn

Vertikal Comment

There is no question that JLG could not perform well as a separate business, it did so for most of its life. However it would have struggled much more severely during the recent recession without Oshkosh help.

The fact is though that it is part of Oshkosh and it is currently helping the group while defence is going through a quieter patch, which if I recall is what a group or a conglomerate is supposed to be about.

A flotation would, it is true, provide a short term return to shareholders, but ridiculously and unjustifiably high fees for arranging such a move would also be cost a tidy sum. The resulting operations are likely to be lumbered with those unproductive costs going forward.

Clearly if the majority of shareholders want it, then it should happen – it is not a difficult transaction. However all this is a total distraction from regular day to day business just to provide a short term gain for an aging speculator.