Icahn knows how to play the spread

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Carl Icahn may be known as a corporate raider, but he is also an arbitrageur. With Clear Channel’s stock trading well below the price of its pending going-private buyout, it appears Icahn has been buying shares to turn a quick profit. According to its quarterly report to the SEC, Icahn Management LP bought up 1.5 million shares of Clear Channel Communications. It’s not known what Icahn paid for the shares. During Q2 CCU traded from 34.90 to 38.58, with the pending buyout, expected to close by year end, at 39.20.


RBR observation: We would not be surprised to find when the Q3 report is filed that Icahn has added to that Clear Channel stake. The credit nervousness in the markets recently beat the stock down as low as 35 bucks. There are no indications, though, that the buyout is in danger of falling apart. As we reported yesterday, Bear Stearns analyst Victor Miller told clients he believes six banks are committed to financing the Clear Channel buyout.


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