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Icahn Reportedly Intends To Sell Texaco Stake If He Loses Proxy Fight

June 2, 1988

NEW YORK (AP) _ Carl C. Icahn says he probably will sell his $1.8 billion stake in Texaco Inc. if he loses his proxy fight against Texaco management, according to a newspaper report published today.

The Wall Street Journal quoted Icahn, who is trying to win five seats on the oil giant’s board at the upcoming annual meeting, as saying in an interview that he did not intend to lose the proxy fight.

″But if I do, obviously, I have the right to sell the stock, which I probably will do,″ he told the newspaper.

The story said Icahn said he would move ″as expeditiously as possible″ to sell his stake should the company defeat him in the proxy contest, perhaps by seeking to arrange a secondary offering of the 36 million shares.

Icahn told the newspaper he was making his comments ″to make it clear, so shareholders understand that if I lose, I don’t want to be a long-term holder, because then there would be no accountability and I believe that it would just be back to business as usual at Texaco.″

The newspaper said Frank Barren, a legal adviser to Texaco, responded by saying: ″It’s just another desperate tactic from another desperate man. It’s another attempt to manipulate the market and Texaco shareholders.″

On Wednesday, Texaco’s stock rose $2.12 1/2 a share to close at $52.37 1/2 in nationwide trading of New York Stock Exchange-listed issues.

In addition to the proxy fight for seats on the Texaco board, Icahn has proposed to buy Texaco in a friendly transaction for $60 a share that values the company at about $14.5 billion.

The Texaco board unanimously rejected the offer last week.

Icahn’s comments to the Journal came on the eve of a meeting late today at which the New York investor planned to discuss with securities analysts and then reporters how he would finance the takeover bid.

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