Red-faced RJR raider retreats
Wednesday 17 April 1996
He was set to team up with fellow corporate raider Carl Icahn to launch a bitter proxy fight at today's RJR annual meeting. Mr LeBow said he called off his fight after failing to win enough votes to elect his board nominees.
His plan was to oust current RJR board members, replace them with people sympathetic to his and Mr Icahn's views and then spin off Nabisco, the food business.
That would have left RJR with the tobacco company RJ Reynolds, which he then wanted to merge with cigarette manufacturer Liggett Group, a subsidiary of his company Brooke Group, of which he is chairman.
But as RJR Nabisco braced itself for one of its most volatile shareholder meetings, Mr LeBow said yesterday. "Although this is disappointing, it comes as no surprise. We always knew we were facing an uphill battle."
The news is a big coup for RJR, which broke records in 1989 as the world's largest leveraged buyout when KKR took it over for $25bn.
Mr Icahn and Mr LeBow together control about 19 million shares, equal to about 7 per cent of RJR, making them the second-largest shareholders.
Both men are notorious for buying up strategic stakes in companies in a bid to force management to execute actions that benefit their own business objectives.
This time, however, neither seem to have any specific plans regarding RJR, apart from continuing to loudly voice their opinions. Mr LeBow attempted to redeem himself yesterday by arguing that his six-month fight with RJR forced the company to restore some shareholder rights and announce an increased dividend and a modest share repurchase programme. "It's no doubt that without the pressure we applied ... managers would not have gone that far," he said.
He said he would continue to demand that RJR spin off Nabisco now. "We still believe in a Nabisco spin-off and we are still convinced that it can and should be done," he said.
Last January RJR floated a 19.5 per cent stake in Nabisco. The move was structured to allow RJR to spin off the remaining Nabisco shares at a future date on a tax-free basis.
However, the RJR board will not consider a complete spin-off until 1997 or 1998.
- 1 Autistic adults could take pure MDMA to 'reduce social anxiety'
- 2 Before you complain about your GP, this is what you need to know about actually doing the job
- 3 Father of 12 accused of raping, beating, starving and abusing his own children in US 'cult'
- 4 Britain's Got Talent 2015: Jamie Raven divides Twitter as fans expose mind-boggling magic trick
- 5 Charlie Charlie Challenge explained: not a Mexican demon being summoned — it's gravity
People are criticising Fifa World Cup sponsors with corrupt corporate logos
Natalie Portman tells Harvard graduates: 'Accept your lack of knowledge'
British tourists complain impoverished boat migrants are making holidays 'awkward' in Kos
Fifa corruption live: Sebb Blatter warns 'more bad news may follow' as he clings to power
Skull found in Spain could be the world's first-ever murder victim
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Australian man punched in the face for defending Muslim women from abuse on train
A nation of inequality: How the UK is failing to feed its most vulnerable people
David Starkey 'tells Amal Clooney to shut up and stop over-promoting human rights'
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
iJobs Money & Business
£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...
£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...