Icahn Enterprises (IEP) Responds to Self-Serving Short Seller Report

Icahn Enterprises L.P. (Nasdaq: IEP) ("IEP" or the "Company") today issued the following statement in response to a short seller's misleading and self-serving report published on May 2, 2023:

Chairman of the Board, Carl C. Icahn, stated: "Hindenburg Research, founded by Nathan Anderson, would be more aptly named Blitzkrieg Research given its tactics of wantonly destroying property and harming innocent civilians. Mr. Anderson's modus operandi is to launch disinformation campaigns to distort companies' images, damage their reputations and bleed the hard-earned savings of individual investors. But, unlike many of its victims, we will not stand by idly. We intend to take all appropriate steps to protect our unitholders and fight back.

"We believe that the greatest paradigm for investment success is activism. We have a long-held belief that at far too many companies today there is no real corporate governance and therefore no accountability and, as a result, companies are not nearly as productive as they should be. The failure of our system presents an opportunity for activists, like us, who are willing to spend the energy, the time and the money to breach the walls that far too many corporations have built to entrench themselves. Over the years, we have generated hundreds of billions of dollars of value for stockholders through activist campaigns where we were able to guide boards and CEOs to take the steps necessary to enhance the value of their companies. Examples of these, to name a few, are Texaco, Reynolds, Netflix, Forest Labs, Apple, CVR Energy, Herbalife, eBay, Tropicana, Cheniere, and Occidental.

"In more recent years the performance of our investment segment has been lower than our historical averages. A key detractor has been our bearish view of the market, causing us to have a large net short position. We recently have taken steps to reduce the short positions in our hedge book and concentrate for the most part on activism, which has served us so well in the past. We believe our existing portfolio has considerable upside potential over the coming years.

"We expect that, over time, IEP's performance will speak for itself. We have a strong balance sheet, with $1.9 billion of cash and $4 billion of additional liquidity, and stand ready to take advantage of all opportunities. As we consider recent events, we are left asking why Mr. Anderson issued this inflammatory report, doing great harm to retail investors. He has admitted to shorting stock before issuing his report, believing that the stock price would temporarily decline. Was that his only goal? Whatever the motive, IEP intends to vigorously defend itself and its unitholders."

Mr. Icahn and his affiliates own approximately 84% of the Company's outstanding units. As a publicly traded limited partnership, IEP offers its unitholders the ability to invest alongside Mr. Icahn as co-owners of IEP and, in so doing, to participate in the Company's activist strategy. To be clear, Mr. Icahn receives no fees, salary or any other compensation from IEP.

The day after the report was published, IEP's market capitalization fell by $6.6 billion for our unitholders. As recently as May 4, 2023, the American Bankers Association said that "the harm caused by short selling that runs counter to economic fundamentals ultimately falls on small investors, who see value destroyed by others' predatory behavior." The good news for IEP's investors is that we have Carl, the liquidity, the strategy and the know-how to fight back.

The following response sets the record straight with respect to the misleading and self-serving claims.

IEP's Board of Directors is focused on preserving an optimal liquidity position for the benefit of all unitholders. Investors are attracted to this commitment, which includes a long-term view of the Company's liquidity needs and a willingness to return capital in a fiscally responsible manner.

• IEP's Board continuously evaluates various strategies for improving its liquidity position. As a fundamental element of this strategy, the Company seeks to raise debt and equity capital when market conditions warrant and when it believes that all of the Company's unitholders will benefit from it doing so. These capital raises are not always driven by an immediate need for liquidity, but instead with a long-term view towards maintaining a strong liquidity position and, if appropriate, making distributions to its unitholders. In this vein, since 2019, the Company has issued units to the public under its ATM program as one of a number of strategies to enhance its liquidity position. In issuing units under the ATM program, IEP welcomes new investors to the IEP family, who are excited to benefit from the core investment strategies and the visionary leadership of Mr. Icahn that IEP uniquely offers.
• Beginning in 2005, IEP's Board of Directors has issued a quarterly distribution to its unitholders. With exceptions, Mr. Icahn has generally taken distributions in units. As he takes distributions in units, it further aligns Mr. Icahn with the public unitholders. Notably, the Company issued quarterly distributions long before the ATM program was in place and the Company's units have traded at a premium to their net asset value since 2014.
• IEP is a diversified holding company that consolidates operating businesses and interests in investment funds (some of which are not wholly owned, which creates non-controlling interests). For example, IEP consolidates 100% of Viskase, of which IEP owns 90% and there is a non-controlling interest of 10%. Due to this complex structure, IEP's consolidated cash flow statement cannot be used in isolation to determine the cash flows at the holding company segment. To increase disclosure to investors, IEP began disclosing holding company segment specific cash flows in the fiscal year 2018 Form 10-K. From 2016 to 2022, our holding company segment net increase in cash flows was $1.6 billion.

IEP's net asset value (NAV) determinations are based on accepted valuation methodologies.

• As of December 31, 2022, IEP used standard industry valuation methods in which the NAV determination for 69% of its gross assets is based on market value, the NAV determination for 14% of its gross assets is based on book value, the NAV determination for 8% of its gross assets is based on market comparable valuation techniques, and the NAV determination for 9% of its gross assets is based on the assistance of third-party valuation consultants.

• With respect to the specific examples the short seller identified in its report, each criticism is fundamentally flawed:
  • Viskase – IEP utilizes an accepted market comparable valuation technique to determine its NAV. As we have disclosed in our earnings materials, it is based on 9.0x Adjusted EBITDA for the prior twelve months. The reason we don't use the trading price of Viskase in making our NAV determination is that Viskase trades on the over-the-counter (OTC) pink sheets. As can be seen below, there are days, even weeks, where Viskase doesn't trade on the OTC.

• • Auto Plus – Auto Plus was valued based on its GAAP book value, which was part of the Auto Segment in IEP's audited financial statements for the year ended December 31, 2022. Additionally, we disclosed that, after the end of our fiscal year, Auto Plus filed for bankruptcy protection, which would reduce the assets and negatively impact the net sales of our Automotive segment in future periods. In connection with the March 31, 2023 financial statements, you will see that the investment in Auto Plus was deconsolidated and we recorded a non-cash charge in connection with this deconsolidation in conformity with GAAP.
  • Real Estate Segment – The NAV for the assets held within IEP's real estate segment is determined based on accepted book value methodologies in accordance with GAAP. Three examples were provided in the report. Combined, these assets (one of which we've never owned) contribute less than 1% of gross net asset value.
• IEP NAV has had several noticeable examples where the sale price ultimately was far in excess of the previously stated NAV. The following chart compares the sales price of significant assets to the mark prior to the asset sale:

IEP is a publicly traded master limited partnership.

• The comparison of IEP to closed-end funds as "peers" is a perfect example of comparing apples to oranges. The short seller report compares the publicly managed vehicles of Third Point and Pershing Square to IEP.
• Both Third Point and Pershing Square are investment advisers that manage closed-end funds. Both charge significant fees, including management, carried interest and other fees. The Hindenburg report itself notes that "Pershing Square charges a 1.5% management fee and 16% performance fee. Third Point charges a 1.25% management and 20% performance fee." The short seller report goes on to further state "We were unable to locate granular disclosure on Icahn's investment fund fees but we reached out to the company for clarification." The reason they cannot find such information is because there are no such fees – a fact the most basic due diligence and review of our public filings would have revealed to an honest reader. IEP is not encumbered by any fees, salary or any other compensation payable to Mr. Icahn. To repeat, there is no comparison between our activist strategy and operating businesses and the closed end funds managed by others.

IEP's unique structure and history explain why the market values its units at a premium to NAV: it provides all investors an opportunity to invest alongside a legend of Wall Street as co-owners of IEP and, in doing so, to participate in the Company's activist business management and investment strategy.

• First, public unitholders of IEP truly invest alongside the iconic Mr. Icahn as co-owners of IEP. A significant portion of Mr. Icahn's personal net worth is represented by his ownership interest in IEP. Therefore, public investors can take comfort in Mr. Icahn's true alignment with their interests.
• Second, IEP investors buy the same units that Mr. Icahn holds. Like any investor, Mr. Icahn may use his IEP equity as an asset in any appropriate manner. Given his alignment with unitholders and the significant amount of his net worth held through IEP, Mr. Icahn pledges IEP units as collateral for borrowings. Mr. Icahn has advised that he and his affiliates are current and in full compliance with all personal loans.
• Third, Mr. Icahn is deeply invested in IEP and, with his affiliates, owns 84% of all outstanding units of IEP. The remaining public 16% is held almost entirely by individual investors and not wealthy institutions. This fact highlights how the short seller report aims to destroy the hard-earned savings of retail and public investors.

IEP does not intend to abandon its unitholders – it will defend their interests in all appropriate manners.

Icahn Enterprises L.P., a master limited partnership, is a diversified holding company engaged in seven primary business segments: Investment, Energy, Automotive, Food Packaging, Real Estate, Home Fashion and Pharma.

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