Jordan Bleznick: Carl Icahn's Creative Tax Strategies and Activist Investing

Jordan Bleznick's Professional Path

• 🧠 Jordan Bleznick, a Cincinnati native, pursued an LLM in tax at NYU in 1980, driven by his problem-solving skills and aptitude for numbers.
• 🚀 He began his career in New York, eventually joining a firm where Carl Icahn became his primary client shortly after the 1984 ACF rail car deal.
• 💡 Bleznick's relationship with Icahn evolved, leading him to become General Tax Counsel for Icahn Enterprises in 2001, a role he held until 2023.

Carl Icahn's Investment Evolution

• 🎯 Icahn transitioned from being labeled a "corporate raider" to an "activist investor," partly influenced by the greenmail excise tax of the 1980s that prevented special buyouts.
• 🔥 His methodology was characterized by dogged determination, not shying away from negative press, and directly challenging company management through "nasty letters" and proxy fights.
• 💰 Icahn Enterprises uniquely combined aspects of hedge funds and private equity funds, allowing Carl to hold investments for extended periods without the liquidity pressures faced by typical hedge funds.

Strategic Role of Tax in Icahn's Deals

• 📈 For Carl Icahn, tax planning was an indispensable component for maximizing after-tax investment returns, giving Jordan Bleznick unusual latitude in structuring deals.
• ✅ Bleznick insisted on reporting directly to Carl Icahn to ensure tax-driven strategies were not vetoed or misunderstood by other executives like CFOs or GCs.
• 🔍 A key aspect of identifying undervalued companies involved analyzing often-overlooked tax assets, such as net operating losses, which other investors might write off.

Icahn's Unique Financial Insights

• 📊 Carl developed his own metric, "Carl cash flow," defined as EBITDA minus maintenance capex, to assess a company's core value beyond standard accounting adjustments.
• ⚠️ He was highly critical of conglomerates and what he termed "mental management," often pushing for the sale of non-core businesses and reducing managerial layers.
• 🚀 The "Icahn Lift" described the phenomenon where a company's stock price would typically jump 5-10% upon Carl's public disclosure of his stake, simply due to his reputation.

Personal Dynamics of Working with Carl

• 💬 Bleznick found Carl 90% entertaining, appreciating his unfiltered communication and humor, despite his occasional relentless criticism.
• 👨‍👩‍👦 A crucial condition for Jordan joining Icahn in-house was the ability to leave early on specific days to spend time with his sons, which Carl agreed to.
• 🎬 An anecdote from a "60 Minutes" segment highlighted Carl's expectation of long working hours, with Jordan's early departure from the office being noticed.