Shares of Icahn Enterprises, the conglomerate owned by Carl Icahn, experienced a significant decline on Friday following a decision by the company to cut its quarterly dividend in half. This move came amidst an ongoing campaign by short-seller Hindenburg Research. The announcement revealed that Icahn Enterprises would issue a $1 per depositary unit distribution, resulting in a 12% annualised yield. This was a significant reduction compared to the $2 dividend paid in the previous quarter, which caused the stock to plummet by a staggering 23.2%. The company’s stock has been highly volatile since Hindenburg Research, led by Nathan Anderson, publicly took a short position in May. Hindenburg Research’s allegations included concerns about “inflated” asset valuations, among other issues. As a result, Icahn Enterprises, which operates across various sectors, including energy, automotive, and real estate, experienced a drastic 44% decline in the second quarter, and the stock’s year-to-date performance showed a steep drop of 50.5%.

Hindenburg Research particularly criticized Icahn Enterprises’ high dividend yield, claiming it lacked support from the company’s cash flow and investment performance. In response, 87-year-old investor Carl Icahn stated that the board of directors would determine future distributions based on economic conditions, business performance, and other factors, asserting that Hindenburg’s report would not influence this practice. Reporting on the second-quarter results, Icahn Enterprises disclosed a net loss of $269 million, more than doubling the loss of $128 million from the same quarter the previous year. Carl Icahn attributed this disappointing quarter to the short-selling activities against the companies and investments he controlled.