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CNBC's David Faber Interviews Billionaire/Activist Investor, Carl Icahn on "Closing Bell" (Transcript Included)

What: Billionaire/Activist Investor, Carl Icahn, to be interviewed on CNBC's Closing Bell
When: Wednesday, May 2 at 4:15 PM ET
Where: CNBC's "Closing Bell"

The following is the unofficial transcript of a CNBC interview with billionaire/activist investor Carl Icahn on CNBC's "Closing Bell" today at 4:15PM ET. All references must be sourced to CNBC.

In an interview with CNBC's David Faber, Carl Icahn discusses the battle with Motorola and his war of words with Motorola CEO Ed Zander in a full-page ad in yesterday's The Wall Street Journal, among other topics.



DAVID FABER: CARL ICAHN JOINS ME FROM MANHATTAN. MR. MR. ICAHN IS WAGING YET ANOTHER PROXY BATTLE WITH THE VERY LARGE COMPANY, MOTOROLA. WHICH WILL, SHAREHOLDERS WHICH WILL VOTE, ABOUT A WEEK, MAY 7th ON, WHETHER OR NOT, MR. ICAHN SHOULD BE PUT ON THE BOARD. ALWAYS A PLEASURE TO HAVE YOU. THANK YOU FOR BEING WITH US.

CARL ICAHN: PLEASURE TO BE WITH YOU, DAVID.

FABER: WHY DO YOU WANT TO BE ON MOTOROLA'S BOARD?

ICAHN: WE OWN BILLION 200 MILLION WORTH OF THE STOCK. WE'RE ONE OF THE LARGEST SHAREHOLDERS. WE DON'T THINK IT'S WELL-MANAGED. WE DON'T BELIEVE THE BOARD HAS DONE A GOOD JOB. TODAY A LOT OF THINGS CAME OUT OBFUSCATED THE SITUATION SO MUCH, THAT, I FELT FELT I SHOULD COME ON.

FABER: YOU HAVE OWN A LOT OF STOCK THEREFORE WANT TO BE ON THE BOARD. YOU OWN A LOT OF STOCK IN OTHER COMPANIES WHERE I'VE SEEN YOU DO POSITIVE THINGS FOR SHARE PRICE BUT NEVER GET ON THE BOARD. TIME WARNER COMES TO MIND, KERR-McGEE. ANY NUMBER OF OTHERS YOU HAVE HAD SUCCESS BUT IT HASN'T BEEN ACTUALLY GOING ONBOARD DIRECTORS. WHY IS THIS A DIFFERENT SITUATION?

ICAHN: TIME WARNER, WE TALKED A LOT ABOUT DICK PARSONS. WE STUDIED THE COMPANY, THEY SHOULD DO A MAJOR BUYBACK AND CUT A LOT OF COSTS. DICK AND I, SPOKE A FEW TIMES ABOUT IT. AND, I THINK HE, AGREED AND I THINK HE FELT THAT, WE WERE VERY HELPFUL IN THAT. THERE WAS NO REASON TO GO ON THE BOARD AFTER THEY ATO THAT KIND OF THING.

FABER: IS MOTOROLA NOT BEEN LISTENING TO YOU, CARL? MY SENSE IS --

ICAHN: THAT'S NOT THE PROBLEM, DAVID. THE PROBLEM WITH MOTOROLA IS IT WAS SUCH A SURPRISE. EARNINGS WERE SO, WERE SO BAD, IT WORRIED ME A GREAT DEAL THAT, THE COMPANY HAD NO MEASURE WHAT THEY WERE DOING. JANUARY 9th THEY SAID MARGINS 8% WHICH IS HUGE. AND IN MARCH, ONLY TWO MONTHS LATER. THEY WERE NEGATIVE FIVE. MEANING THEY LOST 500 DRAL MILLION IN THE FOURTH QUARTER ON, THE, HANDHELD BUSINESS. THAT MADE ME WORRY QUITE A BIT ABOUT THIS COMPANY, ABOUT THIS BOARD. THEY CHANGED DIRECTIONS SEVERAL TIMES. AND, WHAT'S INTERESTING THEY KEEP COMING OUT, TODAY, FOR INSTANCE, AND TALKING ABOUT THE FACT THAT, THEY HAVE HAD, A GOOD RECORD BUT IF YOU LOOK AT IT THEY HAVE SORT OF OBFUSCATED FACTS. IN DECEMBER 04 AFTER THEY SPUN OFF FREESCALE. IF YOU PUT $100 IN MOTOROLA IT WOULD BE STILL WORTH, 100 MAYBE A LITTLE LESS. IF YOU PUT $100 IN NOKIA YOU WOULD BE WORTH $160. THEY HAVE DONE A TERRIBLE THE JOB AND THE BOARD HAS NOT DONE A DAMN THING ABOUT IT IN MY OPINION.

FABER: THEIR CONTENTION YOU WOULD NOT, YOU DON'T HAVE THE TECHNICAL EX-TEASE OR THE FINANCIAL EXPERTISE DEALING WITH THE BALANCE SHEET OF THIS KIND OF A COMPANY TO REALLY ADD MUCH TO THE BOARD. THAT IS WHAT THEY'RE SAYING. BUT THEY ALSO ARE AT LEAST SAYING I'M HEARING THAT THEY'RE SAYING, GIVE US SOME GOOD. GIVE US PEOPLE YOU'D LIKE TO SEE ON THE BOARD AND WE'LL CONSIDER THEM. WHY NOT GO THAT ROUTE?

ICAHN: THAT AGAIN ON FEW INDICATES THE WHOLE FACT. I LIKE TO TALK ABOUT GENERAL CORPORATE GOVERNANCE.

FABER: WE HAVE MORE TIME WE'LL GET TO THAT. LET'S TALK ABOUT THIS.

ICAHN: THE NAMES WOULD BE THE SAME. YOU JUST DON'T NEED ANOTHER BIG NAME GUY IN THE MOTOROLA BOARD, SORT OF FROM THE SAME COOKIE CUTTER. YOU KNOW THE BOHEMIAN CLUB, AUGUSTA GOLF CLUB. MAYBE I WON'T BE INVITED. MAYBE MY SECRETARY LOST MY INVITATION.THAT'S WHAT, THEY'RE TALKINGABOUT.AND YOU DON'T NEED THATHERE. THE -- INVITATION. THE TROUBLE IN THE COUNTRY THESE BOARDS DON'T HOLD THE EXECUTIVES ACCOUNTABLE. I DON'T THINK THEY DO THE JOBS AT ALL. ISSUE SAID HEY, IF YOU DON'T REALLY WANT ME ON I WOULD PUT ANOTHER LARGE SHAREHOLDER ON. THEY DOESN'T WANT THAT. SO, YOU KNOW SORT OF HAS TO BE ME EVEN THOUGH I FEEL I'M HELL OF A NICE GUY AND I FEEL THEY WOULD GET TO LIKE ME.

FABER: I CAN CLAIM THAT AS WELL. I THINK PROBABLY WOULD, CARL. THINGS ARE GETTING NASTY AS THEY TYPICALLY DO AS WE GET CLOSE TO THE THEY'RE USING THINGS YOU SAID IN INTERVIEW WITH MARIA BARTIROMO IN NOVEMBER, AGAINST YOU. I WANT YOU TO LISTEN TO THE CLIP IF YOU CAN AND RESPOND TO IT.

CLIP: ICAHN (FROM PREVIOUS INTERVIEW WITH MARIA BARTIROMO): SOME GUYS ARE PROFESSION BOARD MEMBERS. YOU CAN'T BLAME THEM HOW CAN A GUY BE ON EIGHT BOARDS KNOW WHAT THE HELL HE IS DOING? THESE COMPANIES ARE COMPLICATED. YOU HAVE TREMENDOUS COMPETITION FROM ABROAD. HOW CAN SOMEBODY SIT ONBOARD EVEN IF HE IS SMARTEST IN THE WORLD EVEN IF HE WAS EINSTEIN AND UNDERSTAND WHAT THAT COMPANY WAS DOING.

FABER: THEY HAD 38 BOARD MEETINGS. A LOT OF THEM WERE TELEPHONIC. YOU'RE ON A LOT OF BOARDS. ALMOST SOUNDS LIKE YOU'RE SAYING ABOUT YOURSELF WHY SHOULD YOU GO ON ANOTHER ONE?

ICAHN: WELL, TO BEGIN WITH, I'VE SAID, I SAID PUBLICLY I WOULD, FIRST OF ALL, WHEN THEY TALK ABOUT 11 BOARDS THAT'S NONSENSE. WHEN YOU REALLY TALK ABOUT BOARDS I'M REALLY INVOLVED WITH YOU WOULD SAY IT'S FIVE OF THEM. AND I WOULD, RIGHT NOW, I, JUST SOLD AND I'M HAPPY TO, SAY IT, WE DID PRETTY WELL IN MANAGEMENT ON CASINOS. WE JUST SOLD THE CASINOS. WE SOLD SOLD THE ENERGY COMPANIES. I CAN CERTAINLY CUT IT DOWN TO THREE OR FOUR BOARDS. THAT'S WHAT I TOLD THEM AND TOLD PUBLICLY. I TAKE UMBRAGE THEY KEEP BRINGING THAT UP. AND TWO, IN THIS COMPANY, WHAT THIS BOARD, NEEDS, MORE THAN ANYTHING, THEY HAVE TEN PEOPLE ONBOARD. SUPPOSEDLY EXPERTS IN, EXPERTS IN TECHNOLOGY, THEY HAVE THAT. WHAT THIS COMPANY NEEDS IS SOMEBODY TO TAKE A TOUGH STANCE AND SAY, HEY LOOK, I WOULD BE HAPPY, TELL THAT TO ED ZANDER, IF YOU CAN PRODUCE WHAT YOU SAY YOU'RE GOING TO PRODUCE WHICH IS POSITIVE EARNINGS FOURTH QUARTER. HANDHELD BUSINESS IS A GREAT BUSINESS. AND, YOU SHOULD ABLE TO TURN IT. YOU SHOULD BE ABLE TO BRING IN A POSITIVE EARNINGS. WHICH YOU SAY YOU WILL. BUT WHAT YOU HAVE TO DO, IS WATCH THE BENCHMARKS. AND IF YOU DON'T DO IT, YOU HAVE TO STAND UP TO THE COMPANY, AND YOU HAVE TO STAND UP TO MANAGEMENT, SAY WHAT THE HELL'S WRONG? IF IT IS WRONG AND THEY CAN'T DO THE JOB, SAY TO ED, THANKS A LOT, ED, YOU'RE NOT THE GUY TO RUN THIS.

FABER: ORIGINALLY WHEN YOU AND I SPOKE ABOUT THIS WHEN YOU FIRST TOOK YOUR POSITION SEEMS LIKE YOU WERE LOOKING AT BALANCE SHEET SEEING AWFUL LOT OF CASH AND POSSIBILITY OF RETURNING THAT CASH TO SHAREHOLDERS. YOU SAID TO ME AT TIME. THESE GUYS ARE NOT MONEY MANAGERS. THEY SHOULD GO TO WALL STREET. THAT'S OFF THE TABLE RIGHT NOW, RIGHT?

ICAHN: IT'S OFF THE TABLE THE NUMBERS THEY SAID THEY WOULD COME UP WITH IN JANUARY THEY DID NOT COME UP WITH. IT'S A TREMENDOUS DIFFERENCE I CAN'T UNDERSTAND HOW THEY DIDN'T KNOW IT. IN JANUARY, THEY WERE TALKING ABOUT EIGHT, 9% MARGINS. TALKING ABOUT 3 1/2, 4 MAYBE YOU NEED SOME OF THE MONEY TO WATCH WHAT THE HECK IS HAPPENING ON HOME FRONT.

FABER: THEY GOT RID OF THEIR CFO THEY DID GET RID OF A FEW PEOPLE IN RESPONSE TO CRITICS LIKE YOURSELVES AND OTHER SHAREHOLDERS.IS THAT THAT NOT ENOUGH?

ICAHN: NOT BY FAR. THIS HAS NOT BUILT UP A BENCH. THEY HAVEN'T REALLY, THEY DON'T HAVE A TEAM TO GO IN AND TAKE THIS COMPANY OVER IF IT DOESN'T WORK. THE REASON I'VE BEEN REALLY mSUCCESSFUL WITH COMPANIES 'VE BEEN IN, HEY, I NCENTIVIZE MANAGEMENT, I ELIEVE, MANAGEMENT SHOULD AKE A LOT OF MONEY IF THINGS GO WELL. IF THEY DON'T DO WELL AND I HAVE GUYS WITH ME 18 YEARS. I HAVE GUYS WITH ME TEN YEARS. BUT IF THEY'RE NOT DOING WELL, YOU CAN'T WAIT. CEO IS THE MOST IMPORTANT. NOT THE BOARD. THE CEO, IS IMPORTANT TO A COMPANY. HE RUNS IT. YOU SHOULDN'T MICROMANAGE.

FABER: ALL RIGHT. ON THE, SUBJECT OF CORPORATE GOVERNANCE WE HAVE ABOUT A MINUTE LEFT. YOU AND I HAVE HAD MANY CONVERSATIONS ABOUT IT, YEARS AGO, I'M HEARING YOU SAY MANY OF THE SAME THINGS. YOU DON'T REALLY BELIEVE THINGS HAVE CHANGED AT ALL OR IMPROVED ALL OVER LAST LET'S SAY FIVE YEARS?

ICAHN: DAVID, IT'S ONE OF THE THINGS I WANT TO REALLY TALK ABOUT FOR A MINUTE. I THINK THIS IS A WATERSHED EVENT FOR CORPORATE AMERICA AND CORPORATE GOVERNANCE. I THINK THERE IS NO SUCH THING CORPORATE DEMOCRACY. WHAT YOU HAVE TOO MANY BIG COMPANIES ARE SORT OF FRATERNITIES. I'VE SEEN IT SO MANY TIMES. THEY'RE SO MANY COMPANIES IT JUST BADLY RUN. I MEAN THE FACT I CAN GO INTO THE MEDIMMUNES, TIME WARNERS, AND, FAIR MONTH, JUST TO NAME A FEW, KERR-McGEE, MAKE MONEY FOR ALL SHAREHOLDERS, WE MADE OVER $50 BILLION FOR SHAREHOLDERS SINCE I STARTED THE HEDGE FUND. REASON YOU CAN DO IT --

FABER: YOU DIDN'T GO ONBOARD ON KERR-McGEE. YOU DOESN'T GO ON THE BOARD A LOT OF THOSE.

FABER: YOU DIDN'T HAVE TO. I'M SAYING BOARDS ARE BADLY RUN. COMPANIES ARE BADLY RUN OR NOT WELL-RUN. I'M MAKING ANOTHER POINT. WE, COMPLAIN, YOU AND OTHER PEOPLE COMPLAIN AND A LOT OF THESE FUND MANAGERS COME TRAIN ABOUT EGREGIOUSSALARIES. ABOUT CEO LOUD DOING A BAD JOB TO LOWER OPTIONS PRICES. ABOUT CRAZY SEVERANCE PACKAGES. NOW IF YOU HAVE A CHANCE, TO, BRING ON CORPORATE GOVERNANCE OF SOME TYPE, TO BRING ON AND HAVE SOME TYPE OF ACCOUNTABILITY ON A BOARD SUCH AS MOTOROLA, IF YOU SEND THE MESSAGE, THAT HEY WE'RE NOT INTERESTED. IF BIG INSTITUTION US SEND THAT MESSAGE THEY'RE NOT INTERESTED. THEY HAVE NO RIGHT TO COMPLAIN ANYMORE. WHAT THIS SHOULD DO, SHOULD GET OTHER PEOPLE LIKE MYSELF. IT'S VERY DIFFICULT TO DO A PROXY FIGHT.

FABER: I KNOW

ICAHN: IF YOU CAN'T SHOW SOMEBODY LIKE MYSELF CAN WIN THIS IN COMPANY LIKE MOTOROLA YOU WILL NOT HAVE MORE OF THEM.

FABER: THIS IS CONVERSATION THAT, FOR ANOTHER DAY. I DO WANT TO, ASK ONE QUESTION ON DUAL CLASS VOTING STRUCTURES. WE'RE SEEING IT IN DOW JONES HERE. MURDOCH MAKING A HUGE PREMIUM BID. WHAT IS YOUR THOUGHTS ON THAT? BUYER BEWARE OR SHOULD THEY BE ABOLISHED?

ICAHN: I THINK THEY SHOULD BE COMPLETELY ABOLISHED. IF YOU WANT TO GO PUBLIC HAVE PUBLIC INVEST THEY SHOULD HAVE HAVE A RIGHT TO VOTE AS YOU DO. DEFINITELY SHOULD BE ABOLISHED. THAT IS ANOTHER SUBJECT. CALL YOU AND ASK.

FABER: ANYTIME YOU WANT TO SIT DOWN I'M ALWAYS HAPPY I'LL BE THERE. I APPRECIATE YOU'RE COMING. I WILL DO IT.

ICAHN: DAVID I'M BUSY. YOU'RE BUSY. ANYTIME YOU WANT TO TALK ABOUT CORPORATE GOVERNANCE NYE FAVORITE SUBJECT I THINK THIS IS WATERSHED EVENT. I HOPE I WIN. IF I DON'T THAT'S LIFE, RIGHT? THAT'S LIFE.

FABER: YOU'RE STILL PRETTY RICH. CARL ICAHN THANK YOU FOR JOINING ALL RIGHT.



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