Icahn: Ring the Alarm at Motorola

This column was originally published on RealMoney on Feb. 2 at 2:59 p.m. EST. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.

Like a vulture circling over a wounded carcass, Carl Icahn has a penchant for spotting once-great companies in trouble. He hasn't always been able to get his way -- sometimes to the benefit of his prey. In the case of Motorola (MOT Quote), however, he might have what it takes to shake the board awake.

Three years ago, as Eastman Kodak (EK Quote) was struggling to survive its transformation from a film company to a digital-photography company, Icahn surfaced along with some other agitators to suggest that the company should pay out dividends to shareholders instead of reinventing itself. At the time, Kodak's then-CEO Dan Carp successfully fended off Icahn.

Kodak is selling for about the same price now as it was then, so nobody has really made any money. However, the company is so far still surviving, which it wouldn't have if it had followed the other plan of milking the assets and making no effort toward a new future.

Another Resuscitation Attempt

Then, the corporate vulture resurfaced last year to circle Time Warner (TWX Quote). Of course, since the asset-rich Time Warner merged with the asset-poor AOL in about the worst corporate deal of all time, the stock has spent five years flat-lining, until very recently. CEO Dick Parsons rather successfully neutralized Icahn, who had no real success in finding institutional investors and hedge funds to support his drive to oust Parsons. They saw no brighter future for Time Warner in Icahn's plan than what was already being undertaken.

Since last summer, Time Warner has started showing some signs of life, as Comcast (CMCSA Quote) began to surge and pulled all the cable stocks up along with it. Time Warner's improved valuation is tied in some measure to the impending spinoff of the cable division as a separately traded entity.