Hertz Global Holdings, Inc. (NYSE:HTZ) is currently going through a crisis after it had to withdraw its financial guidance for 2014 amid accounting and operational problems. With a rattle in the company, Carl Icahn revealed that he has an 8.5% stake in Hertz Global Holdings, Inc. (NYSE:HTZ) and he may seek board representation after operational and accounting failures reported by the company. Discussing this issue in a program on Bloomberg, Suraj Srinivasan, associate professor at Harvard Business School, said that this latest disclosure from Carl Icahn has alerted Hertz Global Holdings, Inc. (NYSE:HTZ)’s management that Icahn and other investors have a strong eye on the company and any mismanagement can lead to trust and monetary losses in future.
“The most important thing that he gets done is to make sure the board doesn’t drop its focus on the problem, and Hertz Global Holdings, Inc. (NYSE:HTZ) has a bunch of things going on now, with the accounting stuff, also with the recall that, because of GM cars, so Carl brings pressure on the board, that keeps its eye on the ball,” said Srinivasan.
Srinivasan said that it will not be feasible for Hertz to offer a position on the board to Carl Icahn and consider the crisis solved because one investor doesn’t represent the other 85% of investors in the company. He said the company must take all the investors on board and inform them about the cause of the current problems.
Srinivasan thinks that activists always help companies in elevating its value and shares in the market and Hertz Global Holdings, Inc. (NYSE:HTZ) will definitely take all steps necessary to keep a useful activist investors like Carl Icahn on its board.
Larry Robbins of Glenview Capital is one of the top shareholders of Hertz Global Holdings, Inc. (NYSE:HTZ) owning 19.74 million shares in the company