Well, that ended with a whimper.
Carl Icahn, the famous corporate raider, this morning withdrew his proposal to get Apple to buy back an additional $50 billion worth of its own stock. The unusually abrupt end to what was looking like a long campaign by Icahn against the cash-stuffed tech giant came after the influential proxy adviser ISS recommended that shareholders reject Icahn’s plan at Apple’s annual meeting later this month.
It also followed Apple CEO Tim Cook’s revelation last week that the company had spent $14 billion (paywall) in just two weeks buying back its own stock. At this pace, it’s on track to buy back $32 billion in stock this year, which Icahn seems to now think is close enough to his $50 billion target. (Apple already has a $100 billion buyback plan in place, which it aims to complete by 2015; Icahn wanted this upped to $150 billion, with $50 billion of that spent this financial year, which ends on September 28).
“We are pleased that Tim and the board have exhibited the ‘opportunistic’ and ‘aggressive’ approach to share repurchases that we hoped to instill with our proposal,” Icahn said in an open letter (registration required) to shareholders this morning
The merits of Apple using its cash for a buyback rather than, say, an acquisition or R&D have been debated intensely, but the move has achieved at least one thing: getting Carl Icahn off the company’s back. This is not something that happens often. And Tim Cook only had to spend $14 billion and endure dinner with the notoriously aggressive (and successful) investor to achieve it.