Carl Icahn reports JetBlue’s stake, calling shares worthless

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Carl Icahn at the 6th CNBC Institutional Conference Delivering Alpha on September 13, 2016.

Heidi Gutman | CNBC

Activist investor Carl Icahn reported on Monday that nearly 10% was involved JetBlue Airways, saying the airline’s stock is undervalued. Shares of JetBlue rose more than 15% in extended trading.

Icahn accumulated the interest in a series of purchases in January and February, according to regulatory filings. He has had plans to continue discussions with the company “regarding the possibility of board representation,” the filings said.

JetBlue said in a statement, “We are always open to constructive dialogue with our investors as we continue to execute our plan to increase value for all of our shareholders and stakeholders. “

Representatives for Icahn were not immediately available for comment.

This is not Icahn’s first investment in the airline industry. In one of his most infamous entrepreneurial ventures, the corporate raider took TWA private in the late 1980s, only to see the airline struggle and file for bankruptcy.

JetBlue has been cutting costs and working to improve operations in an effort to return to profitability after a post-Covid travel boom and a closed merger with budget carrier Spirit Airlines. A federal judge ruled last month against a combination of the two airlines, citing reduced competition.

JetBlue had argued that it needed the link to help it compete against the larger American carriers. JetBlue and Spirit are appealing the judge’s ruling.

In the past 12 months, JetBlue stock is down more than 27% from Monday’s close. The NYSE Arca Airline Index, which tracks the sector in general, is up nearly 7% in the same period.

JetBlue’s new CEO, Joanna Geraghty, took the helm on Monday, and the carrier has hired a pair of aviation veterans to get it back on track.

— CNBC’s John Melloy and Leslie Josephs contributed to this report.

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