Published On: Sun, May 1st, 2016

Carl Icahn Sells All His Shares Over China Woes, Makes $2 Billion

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Carl Icahn

 

It has been a tough week for Apple since the tech company revealed its first quarterly revenue decline in 13 years.

It is even tougher now that billionaire Carl Icahn has sold all his Apple shares over fears of China’s economic slowdown and government interference.

Icahn’s exit is aggravating an already depressed sentiment for the Apple stock, triggered by the disappointing first quarter performance of the company. The stock is now farther down by about 10 percent, clipping almost $60 billion from its market value.

“We no longer have a position in Apple. Tim Cook did a great job. I called him this morning to tell him that. I told him it’s a great company. He seemed sort of sad to hear that, ” Icahn said, when asked by Scott Wapner in a CNBC interview what his position is.

BBC reported that after China imposed stricter rules on what can be published online, its State Administration of Press, Publication, Radio, Film and Television shut down Apple’s online book and movie services days before Apple released its earnings results.

New Chinese regulations now outlaw foreign ownership of online publishing services. The rules also require that all content for Chinese people consumption should be housed in servers located in the Chinese mainland.

The move has widely been seen as a threat to Apple’s ability to continue serving the Chinese market, China being its second biggest market for its products. It also positions Chinese company Huawei, Apple’s fierce competitor in the smartphone market, at an advantage.

Icahn, considered an activist investor, acquired his initial stake in Apple valued at about $1 billion in 2013, adding another batch of shares in 2014 valued at $3 billion. At the end of 2015, he had accumulated a total of 46 million shares worth $4.8 billion, according to a Financial Times report.

Icahn had been a huge supporter of Apple CEO Tim Cook. Calling Cook an ideal CEO, Cahn remarked in the TV show Wall Street Week, “I feel so secure with Apple that if it goes down, I just buy more, I don’t worry.”

The billionaire’s perceived risk of Apple’s relationship with China and China’s attitude “worry him a little bit, and maybe more than little.”

In a Bloomberg report, he admitted to the huge profit he made and would come back to a “great company with great management” if China becomes basically steady.

This article was first published at Tech Times, by Sylvia Arce

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