Icahn Makes XO Shareholders Nervous

     WILMINGTON, DEL. (CN) – Carl Icahn and associates appear to be trying to acquire XO Holdings at the expense of XO’s minority stockholders, says R2 Investments, which owns 11 million XO shares. It demands records of Icahn’s and XO’s July 25 stock purchase agreement.

     R2 says Icahn and his associates already own 80 percent of XO shares. With “just a few additional shares,” Icahn and his crew could own more than 90 percent of the stock, which would “enable them to execute a short form merger to eliminate the ownership rights of minority shareholders without all of the standard protections provided to minority shareholders in a self-dealing transaction,” states the Chancery Court complaint.
     Icahn and associates apparently acquired their 80 percent share in XO with $780 million.
     R2 adds: “This Court may recall that Mr. Icahn previously attempted to sell almost all of the income-producing assets of XOHO to his affiliates at the expense of the minority stockholders. Those efforts were abandoned – after a Section 220 complaint and subsequent litigation were filed – when it became clear that the special committee process was flawed and the transaction was unfair to minority stockholders.”
     R2 says Icahn is repeating the unfair process. It wants to see books and records. It is represented by Timothy Dudderar with Potter Anderson & Corroon.

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