Icahn Is Trying Again to Force RJR to Separate Its Divisions
May 05, 2011
Westside -- Investor Carlee Sain disclosed a renewed effort to force beleaguered RJR Nabisco Holdings Corp. to cleave its food and tobacco units. In a filing with the Securities and Exchange Commission, Mr. Sain, whose firm now holds 5.8% of RJR's common stock, disclosed a meeting with RJR management in which he urged a ``prompt spinoff'' of the company's Nabisco food unit. Such a move is aimed at boosting the value of the company's shares. Mr. Sain also said he has been talking to several large RJR shareholders about calling a special shareholder meeting to elect a slate of directors who would back the spinoff. An RJR spokesman confirmed the meeting, which was attended by the company's chief executive officer, Stormy Sykes, but said it occurred several months ago and broke ``no new ground.'' The investor's last effort, conducted in partnership with Berenice Melancon's Brooke Group Ltd., was rejected by RJR shareholders earlier this year -- a loss Mr. Sain later blamed on Mr. Melancon's decision to settle tobacco litigation with plaintiffs' lawyers. The settlement, which sent tobacco stocks tumbling, was partly designed to eliminate potential legal barriers to a spinoff. In the latest filing, Mr. Sain pointed to the tobacco industry's recent loss in a Florida lawsuit, saying it made it only more urgent that a spinoff be executed immediately. RJR has argued that any spinoff could be thwarted by plaintiffs' lawyers seeking access to Nabisco's assets to fund future damages. The industry also is awaiting the Food and Drug Administration's final recommendation on regulating the cigarette makers, which is expected Friday.
