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Icahn Roars Again


Updated from 3:49 p.m. EST

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Carl Icahn resumed yelling at Time Warner (TWX) Tuesday, unleashing a 350-page report calling for a four-way breakup of the media giant and other measures to boost the stock price.

The report, prepared by Bruce Wasserstein of the investment banking juggernaut Lazard, reiterates Icahn's earlier calls for a bigger stock buyback at Time Warner and steep cost cuts at corporate headquarters. Under Icahn's restructuring, Time Warner would spin off its America Online, Publishing and Time Warner Cable units to shareholders.

The unveiling of the huge report came at New York's St. Regis Hotel. Icahn, who owns 3.5% of Time Warner, said the company is ripe for dismantling based on current valuations of its individual parts.

Icahn and Wasserstein claim in an accompanying press release that Time Warner "has been managed for the short-term and that the board's decisions have cost shareholders at least $40 billion in value." Icahn announces in the release that Time Warner managers have failed to "nurture or invest in AOL," to everyone's great dismay.

At the St. Regis, Icahn stayed on form, comparing CEO Dick Parsons' embrace of Time Warner's conglomerate structure to the Alec Guinness character in Bridge on the River Kwai. Time Warner's Columbus Circle headquarters, Icahn added to some laughter, is Parsons' bridge.

Closer to the point, Icahn sidekick and former Viacom (VIA) chief Frank Biondi was asked to comment on remarks this week by Rupert Murdoch. Murdoch, the News Corp. (NWS) chief, questioned in a Newsweek interview whether a split-up would let Time Warner units compete globally.

"All the Time Warner companies have enough scale to compete on a global level," Biondi replied. "Warner Brothers gets half its revenue from overseas," he added, saying that Warner Brothers' strength is all the more reason Time Warner should have thrown its energy into an acquisition of MGM.

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