Carl Icahn says Family Dollar needs a new CEO
07/16/2014 6:14 PM
07/17/2014 9:02 AM
Billionaire investor Carl Icahn kept up his attack on Family Dollar and chief executive Howard Levine on Wednesday, with a terse pronouncement: “The CEO shouldn’t be the CEO.”
Icahn is trying to force a sale of Matthews-based Family Dollar, which he says would improve the company’s performance and help it catch up with larger rivals such as Dollar General. But he admitted that the recently announced upcoming retirement of Dollar General’s CEO “might throw a bit of a monkey wrench” into his plans to push for combining the two companies.
“Sometimes these things take a long time,” said Icahn, speaking during an interview on CNBC. “I do believe there’s great synergy between Dollar General and Family Dollar. Family Dollar’s management is lacking.”
Icahn, 78, a longtime corporate activist and investor known for taking over companies, first announced he had acquired a 9.4 percent stake in Family Dollar last month. If the company doesn’t put itself up for sale, Icahn has threatened to take his demands to Family Dollar’s shareholders and try to force out the whole board of directors.
He would then replace them with his own slate of directors to explore a sale of Family Dollar. Icahn said the company’s discount retail business is fundamentally sound, but management is doing a poor job.
“Family Dollar is in a good area,” said Icahn. “It’s in a good area with bad management.”
Icahn focused his harshest criticism on Levine, son of Family Dollar founder Leon Levine, who has led the retailer since 1998.
“The CEO shouldn’t be the CEO. I don’t mind saying it,” said Ichan.
Kiley Rawlins, Family Dollar’s vice president of investor relations, declined to comment on Icahn’s remarks. The company has said it’s focused on improving results through steps such as closing 370 under-performing stores, cutting corporate jobs and adding beer and wine. Family Dollar is one of the Charlotte region’s most prominent homegrown retailers, with 8,200 stores nationwide.
Icahn also addressed his aggressive and confrontational style with the companies he targets, which frequently involves publishing letters criticizing the companies and replacing managers and boards.
“I talk and people don’t like me,” said Icahn. “What can I do? I feel sad about it.”
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