This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Deal: Icahn Takes Stake in Talisman Energy

NEW YORK (The Deal) -- Shares in Canada's Talisman Energy (TLM) rose almost 10% in after-hours trading Monday but retreated during the session on Tuesday as investors followed Carl Icahn into the restructuring gas producer. Shares were down 2.4% to $12.44 at 1:30 p.m. Tuesday.

The activist investor revealed late Monday that he controlled 5.97% of the group's equity and said he may seek talks with management. His Icahn Capital vehicle made the filing.

"Disclosed approx 61 million share position in Talisman Energy," Icahn later tweeted. "May have conversations with mgmt re strategic alternatives, board seats, etc."

Icahn's position is worth about C$812 million ($786 million), though he acquired control of the shares for just $277 million, mainly by buying options to acquire shares rather than acquiring the shares directly. The 5.97% stake controlled by Icahn makes him Talisman's No. 2 shareholder, behind fund manager Franklin Resources Inc. and ahead of BlackRock Inc.

Calgary, Alberta-based Talisman reappointed former CEO Hal Kvisle in September last year to arrest a slumping share price, driven lower by poorly timed acquisitions and disappointing returns from its North American shale gas operations and its mature North Sea oil assets.

Kvisle promised to sell peripheral and nonperforming assets worth $2 billion to $3 billion and find partners for his company's North Sea business and sell down or exit Canadian gas fields. But the executive has since drawn criticism for the slow pace of sales.

Talisman opened a data room at the end of July, providing information on assets, including its 12% stake in the Ocensa pipeline in Colombia, the Norwegian portion of its North Sea assets and the Canadian Montney and Duvernay gas fields.

Talisman shares have fallen almost 50% from an early 2011 high of more than C$24. They closed Monday at C$13.15, up from C$11.77 five days ago, as rumors emerged that an unnamed investor had begun acquiring a significant stake in the business.

That still leaves a lot of room for improvement, according to some analysts. Talisman, which has a market capitalization of about C$13.6 billion, could be worth slightly over $27 billion if it succeeds in selling unwanted assets, cutting costs and improving performance at its North American and Asia Pacific operations, analysts at Sanford C. Berstein Research noted on Aug. 15.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,106.70 +29.83 0.17%
S&P 500 2,000.02 +2.10 0.11%
NASDAQ 4,570.6370 +13.29 0.29%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs