Activist investor Carl Icahn said that Chesapeake Energy Corp.'s
(CHK) assets are undervalued, and the company's worth is likely to
rise in coming years as natural gas becomes more prized.
In an interview with CNBC, the activist investor, who has
recently become troubled Chesapeake's second-largest shareholder,
said that Chesapeake has very good assets, but "they couldn't
afford to buy some of them," generating a big funding gap. "They
can definitely meet" that gap by cutting costs, he said.
The Oklahoma City-based energy company has been under fire from
shareholders such as Mr. Icahn, who have questioned the board's
loose oversight of Chief Executive Aubrey McClendon. Last month,
that sentiment resulted in an overhaul of the board, and Mr.
McClendon's separation of his role as chairman.
Mr. Icahn, who helped bring about the overhaul, said he isn't
going to sell his Chesapeake shares in the short term, as he thinks
they will rise in value significantly. "I hope you're going to see
a much higher price," he said.
Mr. Icahn, who on Monday accused Forest Laboratories Inc.'s
(FRX) Chief Executive Howard Solomon of dumping $500 million of
stock ahead of the loss of patent exclusivity on antidepressant
Lexapro, said that that the drug maker was a "quintessential
example of what is wrong with governance" in corporate America.
Mr. Icahn has been involved in a long-running battle with Forest
Laboratories's board--which was reignited earlier this month when
he nominated four candidates to its board--and last week he sued
the company in a bid to get more insight on its succession plan. He
told CNBC that he would "like to avoid a proxy fight" in his battle
with the board.
That said, he wouldn't support selling the company. "Not at this
point," Mr. Icahn said. "You can't do it at this point."
Write to Angel Gonzalez at angel.gonzalez@dowjones.com