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Icahn Hedge Funds Sued Over Arbitrage Bets on Endeavor Buyout
By Drooid · · How we work
The Lawsuit Over Alleged Collusion
A Delaware lawsuit filed this week accuses Carl Icahn’s firm, Icahn Enterprises, and several other investors of illegally coordinating arbitrage bets to challenge Silver Lake’s $25 billion acquisition of Endeavor Group Holdings. Endeavor and Silver Lake have asked the court to bar the investors from seeking appraisal relief on shares purchased after the deal was announced.
Background on the Deal and Appraisal Arbitrage
Silver Lake agreed to pay $27.50 per share for Endeavor, a sports and entertainment company, in a transaction announced in 2025. Under Delaware law, a dissenting shareholder may request a court-ordered appraisal of the fair value of its shares. Recent changes to Delaware corporate law have revived “appraisal arbitrage,” where investors buy shares after a deal is announced and then seek a higher court-determined price. The Endeavor case represents the largest appraisal effort ever filed in the state.
Official Positions from the Parties
The company further contends that even if Delaware law permits risk arbitrage, Icahn’s claims should be barred because they allegedly breach disclosure and antitrust obligations. Representatives for Icahn Enterprises and Pentwater did not immediately respond.
Potential Implications for Delaware Corporate Law
If the court limits appraisal arbitrage in this case, it could curb a growing trend among hedge funds to use Delaware courts as a venue for profit-driven litigation. The outcome may also influence other high-profile deals, such as 3G Capital’s $9.4 billion buyout of Skechers USA, which is currently facing its own appraisal and fiduciary-duty lawsuits.
Data & Statistics
- Silver Lake’s purchase price: $27.50 per Endeavor share
- Total value of the Silver Lake-Endeavor transaction: $25 billion
- Number of investment firms that filed appraisal actions in 2025: dozens (exact count not disclosed)
- Comparable appraisal dispute: 3G Capital’s $9.4 billion Skechers buyout
The case underscores the tension between shareholder rights and the use of court-ordered valuations as a strategic investment tool.