Carl Icahn: I Cannot Tell A Lie $TWX

It’s truly become the Carl Icahn version of he said, she said with Timer Warner ($TWX). “Sources” have said Carl is building a long position in Time Warner. Carl has appeared on the televised vision to say, “I don’t own one share of Time Warner and it annoys me that certain speculators use my name to make profits at the expense of other shareholders.”

Someone’s lying. First, Carl’s no fool, he’s not going to say, “Well hell yes I’m long, please join me in bidding up the stock price before I’ve built a full position.” But, why not just simply ignore the question? No comment is just as bad as a “yes, I’m long.” So he says “hell no” in order to help keep the stock lower for longer as he buys more.

Now – former Carl Icahn key grip Keith Meister, who left Carl a number of years ago to form his own hedge fund, Corvex Management, apparently is building an activist position in Time Warner. Keith joined Carl in 2006, just as Carl was waging his first war to breakup Time Warner. He failed then.

Time Warner has been beaten up like most media companies. Consolidation is an easy answer for these media companies to protect themselves from Netflix ($NFLX). Recall that 21st Century Fox ($FOXA) tried buying Time Warner in 2014 for $85. Time Warner rebuffed and its shares are now trading ~20% below that offer. And lest we forget the fact that Jeff Ubben and his ValueAct Capital are “activist” at Fox.

There are fresh rumors that Fox is coming back around, looking to make a run at Time Warner again. This time, said to be willing to pay $105 a share. Has Jeff really become that desperate; overpaying for assets isn’t his typical modus operandi. He won’t let Fox pay such a ridiculous premium unless he’s looking to be a quasi-activist at Time Warner and get his owns hands on HBO. It would be fun to see Carl go round 2 with Time Warner, where he’d have the support of his former protege Meister in the push to get HBO spun off. Now, is spinning off HBO the right now – absolutely not – but will it send Time Warner shares soaring – hells yes.

Disclosure: Long Carl Icahn ex-oil names, capital intensive names and tech names.