What I don't get is why did Tim Cook actually meet with him? What is the obligation? Or is it that Tim Cook wants Icahn to be his broker to plan a large buyout? What is about Icahn that should amuse Tim?
Wow. this guy is such a clown. What's best for the company IS best for the shareholders. It is a comfort that Apple has a large sum in savings. Wether it is used for the proverbial famine season or unforseeable acquisition needs, it is actually the best thing that Apple has such cash to back them up.
Mr. Icahn figures that because Steve Jobs isn't piloting the company, that must mean Tim Cook isn't on the same level. Therefore, Mr. Icahn can come in to leave another carcass in his wake and com out the richer for it. No Apple investor wants Icahn calling the shots. Dear sir, please be quiet and go away.
I'm willing to bet he was more than shocked at how strong, wise, and future-thinking Mr. Cook really is.
And he didn't like it. if things weren't going his way, it was "testy." LOL. I'm guessing he was testing Tim's mettle and found it quite resistant to manipulation.
Note to others: Tim cook is not "new money" and we like him in his role. Thank you.
This poor guy, Mr. Cook. He has secretly been the backbone of Apple for a long time, but was content with being in the background - essentially a thankless job as far as the public goes. Now, he is in the public eye and not only is he not thanked enough, he actually has to field the ignorant sentiment that somehow he is not qualified or that he isn't doing what is in the best interest of the company. In reality, he is overseeing the most successful Apple ever. and he is not afraid to make radical changes (something Jobs instilled in his staff, most obvious when they axed the best selling iPod Mini to create the Nano) seen in the firing of once-great-asset-turned-unrepentant-liability Forstall, restructuring internal teams to enable greater collaboration, the introduction of iOS7, the forthcoming revolutionary Mac Pro, 64 bit mobile computing, fingerprint authentication that actually works reliably, etc., etc. The man moves quick and he is very thorough.
It's always difficult to come after the rock star. And Tim Cook had the unenviable position of doing just that. But he is doing it and doing it very, very well. Props to Tim Cook.
As people pointed, Icahn has no clue about technologies company other than they do not perform to the level which he thinks they should do. This is the first time he trying to get his hands into a company which is not having troubles, which is his claim to fame. But if you look at ever company he got his hands on no longer exist or is a shell of what they were. He always make money since he gets in when it low and then forces the company to do thinks that prop up the stock value and then gets out and does not care when happen after that. He just another guy trying to manipulate a company into doing things which are only good for the stock value and nothing else. He hides behind the fact that he said he trying to help shareholders and the company.
Ask your self, would you invest in the company who is obviously having issues, hell no you run the other ways, this guy runs to them and always comes with more money than anyone else.
Even Warren Buffet said he will not invest in Apple since he does not understand the whole Tech industry. He invest in what he knows and in companies which could be better.
I hope Apple has taken sufficient steps to retain control in the board, should outside "activist" shareholders attempt to shake them down the way Icahn has companies in the past.
The board needs to consider the needs of all shareholders and how to keep the company valuable.. but Icahn has been able to use lawsuits to sell the idea that "wahtever maximizes shareholder return in the short term is the boards duty".... and that could be very dangerous.
Alas, now that Icahn has a position, it's too late to enact such measures, so hopefully they did it back in the 1990s when they were vulneragble to a hostile takeover.
This version of dinner with Steve Jobs instead of Tim Cook:
Icahn: I believe that the Apple board should listen more to what the shareholders want.
Steve Jobs: F*ck off.
Icahn: Okay, what should we have for dessert?
Steve knew when to woo and when to go to war. He was magnetic when I wanted to seduce you.
Icahn's looking long in the tooth. My guess is he's got not long for the world and wants to spread his financial might around before he kicks the bucket.
This version of dinner with Steve Jobs instead of Tim Cook:
Icahn: I believe that the Apple board should listen more to what the shareholders want.
Steve Jobs: F*ck off.
Icahn: Okay, what should we have for dessert?
Funny and (I'm guessing) true!
I don't recall hearing about Jobs ever meeting financial morons like him. He cared more about the products and I doubt he had the slightest interest in or patience for Wall St or even lawyers and financial people within Apple unless they were working on something he wanted or of direct relevance to the products. Sadly I think this demonstrates just how different Cook is from Jobs and it worries me a little.
What Jobs understood was that if the products are great then customers will embrace them and the company will do well. The danger from letting vision-less financial people get too much control is that they can lose focus on the products and respect for the talented engineers and designers that make them and instead try to manufacture success through corporate schmoozing, stock manipulation and marketing and these are roads to ruin.
I hope that reports of the meeting being testy were because Cook wasn't really that interested in anything he said, but then if that's the case why even meet him in the first place...
This version of dinner with Steve Jobs instead of Tim Cook:
Icahn: I believe that the Apple board should listen more to what the shareholders want.
Steve Jobs: F*ck off.
Icahn: Okay, what should we have for dessert?
LOL
WSJ: A cordial meeting between Steve and a large stockholder was had and all issues were resolved.
What I don't get is why did Tim Cook actually meet with him? What is the obligation? Or is it that Tim Cook wants Icahn to be his broker to plan a large buyout? What is about Icahn that should amuse Tim?
There's no obligation. Cook was not required to meet with Icahn.
However, it was not unreasonable to do so. First, Icahn holds over a billion dollars in AAPL. The mere fact that he was buying increased the share price. If he were to start dumping the stock, it would probably clobber the share price. There's no harm in having dinner with the guy.
The only thin Ican wants is apple to buy a boat load more of there shares back so his stock becomes more valuable so he can cash in.
Props to Cook for telling the blowhard to get real. The guy must really get amused by manipulating companies. Fortunately for Apple he is a tiny investor % of owned stock wise.
There's no obligation. Cook was not required to meet with Icahn.
However, it was not unreasonable to do so. First, Icahn holds over a billion dollars in AAPL. The mere fact that he was buying increased the share price. If he were to start dumping the stock, it would probably clobber the share price. There's no harm in having dinner with the guy.
I agree completely.
When you are head of Apple Corps, you are almost obligated to meet powerful individuals like Icahn. Think about the Queen of England who is obligated to meet and greet the latest Commonwealth dictator to rise to the top of the heap - when they come to the Uk on a bargaining mission. Or like the diplomatics corp who cordially meet their opposite numbers but still hate their guts. Notice how all the pre-meeting PR was coming from Icahn - he even stated his agenda beforehand.
I think it was a fishing trip and Icahn didn't get the reception he wanted, was sent away with a flea in his ear from Peter Openheimer telling him to go home and do his homework.
...and Icahn is still working the media!
Icahn definitely thinks Apple is vulnerable on the APPL front and seems to be planning to go one way or the other, dependant on these so-called 'talks'...he likely doesn't care which.
On the other hand, while Icahn may make some PR headway, Apple no doubt is launching countermeasures of their own.
Just out of interest, what does splitting the stock achieve? How does it weaken Icahn's investment value...proportionally, or the strength of his argument, or his proxy strength? I know the practical benefits personally, having been blessed twice over....but what's the business management argument?
Just out of interest, what does splitting the stock achieve? How does it weaken Icahn's investment value...proportionally, or the strength of his argument, or his proxy strength? I know the practical benefits personally, having been blessed twice over....but what's the business management argument?
No one ever claimed that it would weaken Icahn's (or anyone else's) share value.
What it achieves is that it makes the stock more affordable for small investors. The average investor who can set aside $100 a month to buy shares is far more likely to buy AAPL monthly than to wait 5 months and then buy one share. There's also a psychological difference for the small investor. Buying shares at $50 isn't as scary as buying them at $500 - even if the actual proportional value doesn't change.
That yields two results:
1. If it brings new investors into the market, it increases demand for the stock, thereby increasing the price. Even though each individual investor only buys a few shares, the aggregate amount could be significant.
2. It would have absolutely no impact on institutional buyers or large buyers like Icahn. Any effect would be only on smaller buyers - and could therefore shift the ownership slightly away from institutions (who tend to buy and sell at the drop of a hat and create a lot of volatility).
While the total number of shares would be modest, it doesn't take a lot to have an impact. A couple million shares one way or the other could be significant.
I don't recall hearing about Jobs ever meeting financial morons like him. He cared more about the products and I doubt he had the slightest interest in or patience for Wall St or even lawyers and financial people within Apple unless they were working on something he wanted or of direct relevance to the products. Sadly I think this demonstrates just how different Cook is from Jobs and it worries me a little.
Tim Cook just seems to try to keep people happy. There are a lot of conflicts going to crop up because of this. The Apple employees regularly state that they don't put much importance on money and yet the cash hoarding, tax setups seem to run counter to that but is part of their fiduciary responsibility. Their employment almost requires that they operate counter to their core values. At the same time, a lot of the major stockholders likely primarily care about money and the major ones have a say in how the company is run. So people who don't care about money yet have a responsibility to care about it because of the people whose only interest in Apple is money are not going to see eye to eye.
I'd say one difference between Tim and Steve is that Steve wouldn't try to keep everyone happy, he always had teams competing for success. Tim prefers collaboration. When a stockholder would have something to say, I'd expect Tim to try and work it out. Steve would most likely just wear his values on his sleeve and let people deal with it e.g doing a good job should be its own reward and if financial success is a result then so be it. Steve was asked about how he felt when Apple surpassed Microsoft's market cap and what he said was:
"It's surreal, but it doesn't matter very much. It's not what's important. It's not what makes you come to work in the morning. It's not why any of our customers buy our products so I think it's good for us to keep that in mind and just what we're doing and why we're doing it.
Apple was about 90 days from going bankrupt in the early days and it was much worse than I thought when I went back but I expected that all the good people would have left and I found these miraculous people, these great people and I tried to ask this as tactfully as I could but "why are you still here?" and a lot of them had this little phrase "I bleed in 6 colors", which was the old Apple logo and it was code for 'because I love what this place stands for'"
People who are involved in finance don't all understand this because they put a price tag on everything. The documentaries about the stock traders that caused the financial crisis talk about how they would go to prostitutes, have it billed to their company cards under miscellaneous expenses and then go home to their families. How they would take cocaine all night long and get up to go to work the next day making risky trades but taking no responsibility. These kind of values (or lack thereof) don't align with the people who work at Apple.
I don't think that people who have these disparate natures can reconcile this because it's like trying to explain to someone why you prefer chocolate ice-cream over strawberry. Everyone lives their lives to reach positive states of mind. Some people see everything as material and therefore subordinate to the common exchange currency of money and that's a valid way to look at things but has the side-effect of placing money first. Other people see that money is a byproduct of things that are of genuine value and it's the latter that comes first. When doing a good job because that's the goal results in financial success, both groups are happy. When a point is reached where doing a good job doesn't give the same financial reward because of inherent limits in the market, that's where it breaks down. The people who want the money don't care about the long term values of Apple, they want paid now, they want growth now, they want more innovation now.
Under the assumption that the people at Apple don't care about money, it might seem that draining the cash reserves to benefit the stockholders would be ok. It wouldn't matter to the people at Apple what happens with it and the money-grabbers get their loot/growth. But rewarding short-term investors over long-term investors runs counter to their values and Tim's primary responsibility is in making sure Apple is on a steady course to stay around because Apple is one of the diamonds in the rough that needs to stay around. Bending to the whims of greedy individuals doesn't set a good precedent for this.
The problem remains that they have a lot of cash and are not doing anything with it. That's the problem that needs to be solved. Stock buybacks are fine as long as the company trades below its intrinsic value. Apple isn't really trading below this any more. If they want to spend for long term stability then they should be buying into timeless business models like content creation/distribution. They can do some crazy things like buying Disney but they should be sensible about where technology is going and make suitable purchases. It's a lot about the people at the companies too rather than what they do. I'd much rather see them use the cash to do buyouts because one of the most recent resulted in the fingerprint sensor so that gets filtered down to customers and what customers love. Stock buybacks do no such thing. It's fine when cash is excessive but $150b can be put to far better use.
Comments
Mr. Icahn figures that because Steve Jobs isn't piloting the company, that must mean Tim Cook isn't on the same level. Therefore, Mr. Icahn can come in to leave another carcass in his wake and com out the richer for it. No Apple investor wants Icahn calling the shots. Dear sir, please be quiet and go away.
I'm willing to bet he was more than shocked at how strong, wise, and future-thinking Mr. Cook really is.
And he didn't like it. if things weren't going his way, it was "testy." LOL. I'm guessing he was testing Tim's mettle and found it quite resistant to manipulation.
Note to others: Tim cook is not "new money" and we like him in his role. Thank you.
This poor guy, Mr. Cook. He has secretly been the backbone of Apple for a long time, but was content with being in the background - essentially a thankless job as far as the public goes. Now, he is in the public eye and not only is he not thanked enough, he actually has to field the ignorant sentiment that somehow he is not qualified or that he isn't doing what is in the best interest of the company. In reality, he is overseeing the most successful Apple ever. and he is not afraid to make radical changes (something Jobs instilled in his staff, most obvious when they axed the best selling iPod Mini to create the Nano) seen in the firing of once-great-asset-turned-unrepentant-liability Forstall, restructuring internal teams to enable greater collaboration, the introduction of iOS7, the forthcoming revolutionary Mac Pro, 64 bit mobile computing, fingerprint authentication that actually works reliably, etc., etc. The man moves quick and he is very thorough.
It's always difficult to come after the rock star. And Tim Cook had the unenviable position of doing just that. But he is doing it and doing it very, very well. Props to Tim Cook.
As people pointed, Icahn has no clue about technologies company other than they do not perform to the level which he thinks they should do. This is the first time he trying to get his hands into a company which is not having troubles, which is his claim to fame. But if you look at ever company he got his hands on no longer exist or is a shell of what they were. He always make money since he gets in when it low and then forces the company to do thinks that prop up the stock value and then gets out and does not care when happen after that. He just another guy trying to manipulate a company into doing things which are only good for the stock value and nothing else. He hides behind the fact that he said he trying to help shareholders and the company.
Ask your self, would you invest in the company who is obviously having issues, hell no you run the other ways, this guy runs to them and always comes with more money than anyone else.
Even Warren Buffet said he will not invest in Apple since he does not understand the whole Tech industry. He invest in what he knows and in companies which could be better.
IMO the guy is an asset stripper, pure and simple, and can only ending up harming Apple.
He might be a slimy fat-cat, but you've got to far in killing him off there. Easy horsey.
Obama, lol. 'The next Kennedy' they said.
I hope Apple has taken sufficient steps to retain control in the board, should outside "activist" shareholders attempt to shake them down the way Icahn has companies in the past.
The board needs to consider the needs of all shareholders and how to keep the company valuable.. but Icahn has been able to use lawsuits to sell the idea that "wahtever maximizes shareholder return in the short term is the boards duty".... and that could be very dangerous.
Alas, now that Icahn has a position, it's too late to enact such measures, so hopefully they did it back in the 1990s when they were vulneragble to a hostile takeover.
Steve knew when to woo and when to go to war. He was magnetic when I wanted to seduce you.
Funny and (I'm guessing) true!
I don't recall hearing about Jobs ever meeting financial morons like him. He cared more about the products and I doubt he had the slightest interest in or patience for Wall St or even lawyers and financial people within Apple unless they were working on something he wanted or of direct relevance to the products. Sadly I think this demonstrates just how different Cook is from Jobs and it worries me a little.
What Jobs understood was that if the products are great then customers will embrace them and the company will do well. The danger from letting vision-less financial people get too much control is that they can lose focus on the products and respect for the talented engineers and designers that make them and instead try to manufacture success through corporate schmoozing, stock manipulation and marketing and these are roads to ruin.
I hope that reports of the meeting being testy were because Cook wasn't really that interested in anything he said, but then if that's the case why even meet him in the first place...
LOL
WSJ: A cordial meeting between Steve and a large stockholder was had and all issues were resolved.
There's no obligation. Cook was not required to meet with Icahn.
However, it was not unreasonable to do so. First, Icahn holds over a billion dollars in AAPL. The mere fact that he was buying increased the share price. If he were to start dumping the stock, it would probably clobber the share price. There's no harm in having dinner with the guy.
I agree completely.
The only thin Ican wants is apple to buy a boat load more of there shares back so his stock becomes more valuable so he can cash in.
Props to Cook for telling the blowhard to get real. The guy must really get amused by manipulating companies. Fortunately for Apple he is a tiny investor % of owned stock wise.
When you are head of Apple Corps, you are almost obligated to meet powerful individuals like Icahn. Think about the Queen of England who is obligated to meet and greet the latest Commonwealth dictator to rise to the top of the heap - when they come to the Uk on a bargaining mission. Or like the diplomatics corp who cordially meet their opposite numbers but still hate their guts. Notice how all the pre-meeting PR was coming from Icahn - he even stated his agenda beforehand.
I think it was a fishing trip and Icahn didn't get the reception he wanted, was sent away with a flea in his ear from Peter Openheimer telling him to go home and do his homework.
...and Icahn is still working the media!
Icahn definitely thinks Apple is vulnerable on the APPL front and seems to be planning to go one way or the other, dependant on these so-called 'talks'...he likely doesn't care which.
On the other hand, while Icahn may make some PR headway, Apple no doubt is launching countermeasures of their own.
Just out of interest, what does splitting the stock achieve? How does it weaken Icahn's investment value...proportionally, or the strength of his argument, or his proxy strength? I know the practical benefits personally, having been blessed twice over....but what's the business management argument?
No one ever claimed that it would weaken Icahn's (or anyone else's) share value.
What it achieves is that it makes the stock more affordable for small investors. The average investor who can set aside $100 a month to buy shares is far more likely to buy AAPL monthly than to wait 5 months and then buy one share. There's also a psychological difference for the small investor. Buying shares at $50 isn't as scary as buying them at $500 - even if the actual proportional value doesn't change.
That yields two results:
1. If it brings new investors into the market, it increases demand for the stock, thereby increasing the price. Even though each individual investor only buys a few shares, the aggregate amount could be significant.
2. It would have absolutely no impact on institutional buyers or large buyers like Icahn. Any effect would be only on smaller buyers - and could therefore shift the ownership slightly away from institutions (who tend to buy and sell at the drop of a hat and create a lot of volatility).
While the total number of shares would be modest, it doesn't take a lot to have an impact. A couple million shares one way or the other could be significant.
Tim Cook just seems to try to keep people happy. There are a lot of conflicts going to crop up because of this. The Apple employees regularly state that they don't put much importance on money and yet the cash hoarding, tax setups seem to run counter to that but is part of their fiduciary responsibility. Their employment almost requires that they operate counter to their core values. At the same time, a lot of the major stockholders likely primarily care about money and the major ones have a say in how the company is run. So people who don't care about money yet have a responsibility to care about it because of the people whose only interest in Apple is money are not going to see eye to eye.
I'd say one difference between Tim and Steve is that Steve wouldn't try to keep everyone happy, he always had teams competing for success. Tim prefers collaboration. When a stockholder would have something to say, I'd expect Tim to try and work it out. Steve would most likely just wear his values on his sleeve and let people deal with it e.g doing a good job should be its own reward and if financial success is a result then so be it. Steve was asked about how he felt when Apple surpassed Microsoft's market cap and what he said was:
"It's surreal, but it doesn't matter very much. It's not what's important. It's not what makes you come to work in the morning. It's not why any of our customers buy our products so I think it's good for us to keep that in mind and just what we're doing and why we're doing it.
Apple was about 90 days from going bankrupt in the early days and it was much worse than I thought when I went back but I expected that all the good people would have left and I found these miraculous people, these great people and I tried to ask this as tactfully as I could but "why are you still here?" and a lot of them had this little phrase "I bleed in 6 colors", which was the old Apple logo and it was code for 'because I love what this place stands for'"
People who are involved in finance don't all understand this because they put a price tag on everything. The documentaries about the stock traders that caused the financial crisis talk about how they would go to prostitutes, have it billed to their company cards under miscellaneous expenses and then go home to their families. How they would take cocaine all night long and get up to go to work the next day making risky trades but taking no responsibility. These kind of values (or lack thereof) don't align with the people who work at Apple.
I don't think that people who have these disparate natures can reconcile this because it's like trying to explain to someone why you prefer chocolate ice-cream over strawberry. Everyone lives their lives to reach positive states of mind. Some people see everything as material and therefore subordinate to the common exchange currency of money and that's a valid way to look at things but has the side-effect of placing money first. Other people see that money is a byproduct of things that are of genuine value and it's the latter that comes first. When doing a good job because that's the goal results in financial success, both groups are happy. When a point is reached where doing a good job doesn't give the same financial reward because of inherent limits in the market, that's where it breaks down. The people who want the money don't care about the long term values of Apple, they want paid now, they want growth now, they want more innovation now.
Under the assumption that the people at Apple don't care about money, it might seem that draining the cash reserves to benefit the stockholders would be ok. It wouldn't matter to the people at Apple what happens with it and the money-grabbers get their loot/growth. But rewarding short-term investors over long-term investors runs counter to their values and Tim's primary responsibility is in making sure Apple is on a steady course to stay around because Apple is one of the diamonds in the rough that needs to stay around. Bending to the whims of greedy individuals doesn't set a good precedent for this.
The problem remains that they have a lot of cash and are not doing anything with it. That's the problem that needs to be solved. Stock buybacks are fine as long as the company trades below its intrinsic value. Apple isn't really trading below this any more. If they want to spend for long term stability then they should be buying into timeless business models like content creation/distribution. They can do some crazy things like buying Disney but they should be sensible about where technology is going and make suitable purchases. It's a lot about the people at the companies too rather than what they do. I'd much rather see them use the cash to do buyouts because one of the most recent resulted in the fingerprint sensor so that gets filtered down to customers and what customers love. Stock buybacks do no such thing. It's fine when cash is excessive but $150b can be put to far better use.