Carl Icahn Buys Stake In Manitowoc, May Seek Spin-Off

(RTTNews) - Activist investor Carl Icahn on Monday disclosed that he has accumulated a 7.7 percent stake in Manitowoc Co. (MTW) and plans to seek a separation of the company's Crane and Food service equipment businesses into two distinct companies. Shares of Manitowoc is currently trading up 9 percent on the New York Stock Exchange.

Icahn Capital believes the shares of Manitowoc to be undervalued and said it will push for separating the company's Crane and Food service equipment segments. It would also seek shareholder board representation if appropriate, the investment firm said in a SEC filing.

Icahn has bought 10.5 million shares for about $146.6 million, according to the filing. The stake makes Icahn the third largest investor in Manitowoc, behind Fidelity Management and Relational Investors.

A similar attempt was made by Relational Investors in June to split Manitowoc into two after purchasing an 8.5 percent stake in the company. Relational Investors had said that Manitowoc's "two businesses differ materially in their operating metrics and cyclical characteristics, which we're convinced causes a perpetual discount in the share price."

For the third quarter, Manitowoc's Crane segment sales declined 6.7 percent, while Food service equipment sales grew 3.8 percent. Although, Crane business contributes the bigger chunk of total revenues, operating profit is higher at the Food service segment.

MTW is currently trading at $22.78, up $1.86 or 8.89%, on the NYSE.