US Markets

Carl Icahn slams EPA, says Trump's pick Pruitt will 'do the job'

Icahn: Companies are afraid to invest because of red tape
Icahn: Companies are afraid to invest because of red tape

Billionaire activist investor Carl Icahn said Thursday that Oklahoma Attorney General Scott Pruitt will "do the job" as Environmental Protection Agency chief.

Icahn has been a sharp critic of the EPA in the past. He told CNBC's "Power Lunch" on Thursday that the agency is one of the worst-run organizations he's ever seen, and said he initially had doubts about Pruitt.

"I must have met him three or four times because at the first time, I wasn't quite sure that he'd be the perfect guy to really clean that EPA up," he said. "What you have to do here is be very tough."

Pruitt, along with other state attorneys general, is suing the EPA over Obama administration rules, and has repeatedly slammed the agency for what he argues is regulatory overreach. The pick gives a clear signal that Trump could follow through on pledges to roll back climate-related regulations and improve the operating environment for fossil-fuel companies.

Icahn said Donald Trump as president should eliminate "crazy regulations," and lower the depreciation schedule so investment in the U.S. "make sense." In fact, as of September 30, 47 percent of Icahn's portfolio is weighted in the energy sector. Some of his major holdings include CVR Energy and Cheniere Energy.

Regarding the selection of Trump's Cabinet picks, Icahn said he interviewed "four or five very good candidates," and spoke with Pruitt about four times, eventually coming to the conclusion that he was the best candidate. Icahn also said he spoke with Trump's Treasury secretary pick, Steve Mnuchin, and strongly backed him, as well as Wilbur Ross, Trump's pick for Commerce secretary. He wouldn't comment on whether he was interviewing candidates for secretary of state.

Icahn supported Donald Trump throughout his campaign, saying he thought Trump would be the best president to grow the economy. Several months ago, he said a Trump presidency would see a more robust business climate through fewer regulations and an economy that would grow faster with more people working.

The day after the presidential election, Icahn told CNBC that Trump's victory was "a step in the right direction." Market futures plunged more than 800 points during the night of the election as it appeared more and more likely that Trump would win. The following day, however, stocks were trading higher by about 200 points. Icahn said at the time that he used the market dip as an opportunity to buy more stock, adding that he does not think a Trump presidency will be a negative for the market.

This story is developing. Please check back for further updates.

—CNBC's Jacob Pramuk contributed to this report.