Icahn Enterprises, his publicly traded limited partnership that operates as a holding company, fell by 20% the most on record erasing $3.1 billion from his fortune. Hindenburg also detailed the investors margin loan collateralized by his stake in the company, which was not previously accounted for by the Bloomberg Billionaires Index. That lopped off another $7.3 billion from the net worth calculation.

All told, Icahns fortune sank by an unprecedented 41% to $14.6 billion, according to the wealth index, dropping him from the worlds 58th-richest person to the 119th.

Icahn, 87, is the latest billionaire to be targeted by Hindenburg this year after the New York-based short-seller went after Indias Gautam Adani and Block Inc.s Jack Dorsey. He owns more than 85% of Icahn Enterprisess units through various entities, making up the bulk of his fortune.

Hindenburg said the company, with investments in funds managed by Icahn and controlling stakes in businesses in the energy, automotive, food and other sectors, was over-leveraged and traded at an extreme premium to its net asset value. Hindenburg also questioned how the company valued some of its investments.

In a statement, Icahn called the report self-serving and intended solely to generate profits on Hindenburgs short position.

Icahn has boosted his holding in Icahn Enterprises by taking dividends in the form of additional units. Before Tuesdays decline, his stake was worth $15.7 billion compared with $8.4 billion in 2017, even as the value of its shares declined 4.9%.

Other unit holders received their dividends in cash, making the company attractive to retail investors, Hindenburg said. That was only possible because of Icahn s decision to take his payment in units, since the company was consistently operating with negative cash flows, the short-seller said.

Icahn began reporting a margin loan collatralized by his stake in the company beginning in 2021, at a time when he had about 65% of his shares pledged. He boosted the number last year, and as of February had more than 181 million shares worth $9.2 billion backing the loan, according to the companys 2022 annual report. 

Margin loans involve lending thats collateralized by the value of the underlying shares. If the value of the stock decline, lenders can request additional collateral or for the loan to be repaid, and have the ability to seize and sell the shares if a borrower fails to do so. 

Hindenburg criticized Icahn for failing to disclose how much hed borrowed, the interest rate or the loan-to-value maintenance ratio associated with the margin loan.

In its annual report, Icahn Enterprises said, Mr. Icahn has advised that he and his affiliates have sufficient additional assets to satisfy any obligations pursuant to these loans without recourse to the depositary units, he has no need or intention to allow foreclosure on such collateral, and that he is current on all principal and interest payments with respect to the loans.

Icahns second-largest asset is his stake in his investment funds, which he uses to make activist bets. Icahn Enterprises, Carl Icahn and his son Brett are the only investors in the funds. 

At the end of last year Icahn had $4.9 billion invested. Hindenburg calculated that the fund could be down about 17% this year, based on an estimate of the performance of its long and short positions. 

Hindenburgs attacks on the companies of Adani and Dorsey caused drops in their fortunes this year of $58 billion and $500 million, respectively. 

I really was gobsmacked, Risher said during an interview with The Associated Press as he recalled being recently asked to replace Lyft co-founder Logan Green as CEO.

Risher quickly shook off his initial shock and is now making an effort to reverse the San Francisco companys mounting losses and sagging stock price. Just days after taking over as CEO, Risher came up with a restructuring plan that includes laying off nearly 1,100 employees whose job losses could help him attain stock price incentives potentially worth nearly $1 billion.

Like any mass layoff, the payroll purge will uproot the lives of those suddenly out of a job while sowing uncertainty among Lyfts remaining 3,000 employees. But Risher believes the deep cuts had to be done so Lyft can afford to bring down its fares to the same levels as its longtime rival, ride-hailing leader Uber, which has rebounded from the pandemic much more robustly.

Its very important to our customers that when they open both (the Uber and Lyft) apps that they are not surprised by the prices being super different, Risher said. We want to be in line with where Uber is.

The cost-cutting also will help Lyft pay drivers better, another element that Risher believes is needed for the service to offer more rides with quicker pick-up times.

Mobile tracking data compiled by wireless network testing firm GWS found Lyfts driver app now averages about 400,000 daily usages half its pre-pandemic levels while Ubers driver app boasts about 1.4 million daily users, roughly the same number that it had leading up to the pandemic.

More details about Rishers turnaround strategy are expected Thursday when Lyft releases what are expected to be lackluster financial numbers for the first three months of the year.

The problems facing Risher are an offshoot of pandemic-driven restrictions that dramatically curtailed travel during most of 2020 and much of 2021, shriveling demand for rides on Uber and Lyft.

But Uber had something that Lyft didnt a food delivery business that had been aggressively expanding under Dara Khosrowshahi, who Uber hired in 2017 to clean up a mess that its previous CEO Travis Kalanick had created. Ubers disarray had also alienated many of its passengers, helping Lyft to steadily gain market share leading up to the pandemic in March 2020.

Khosrowshahis decision to transform Uber into a go wherever you want, get whatever you need operation paid off during a pandemic that ignited explosive growth in food delivery. That demand kept millions of people using Ubers app even when they werent going anywhere, forming habits that helped Ubers ridership return to pre-pandemic levels while Lyft fell out of favor.

No one was opening their Lyft app, so when the world reopened it just seem easier to get an Uber, said Tom White, an analyst for D.A. Davidson.

Because Ubers food delivery service also helped retain drivers on its platform during the pandemic, that made it more difficult for Lyft to lure them back when the pandemic eased. The driver shortage was compounded by a fare structure that resulted in its service frequently demanding significantly higher prices for the trips than Uber a gap that consumers who kept both apps on their phones could quickly see.

Brian Blitzstein used to drive for Lyft but says he is now focused primarily on Uber because of all the ridership momentum that it gained from its food delivery service during the pandemic. But he could be convinced to come back to Lyft if he earns more pay.

Money talks, Blitzstein, 39, said. But I definitely think its going to be challenging for Lyft. Are they going to be cutting down to the bone? That would be like cutting off your arm to lose weight.

The widening chasm between Uber and Lyft has been showing up in their respective financial results. Uber shares surged nearly 12% Tuesdays after the company more ridership, food delivery and revenue gains during the first three months of the year.

Under a benchmark tracked by investors known as adjusted earnings before interest, taxes, depreciation and amortization, Uber posted a profit of $1.7 billion last year while Lyft sustained a loss of $406 million and management in February issued an outlook that made things look like they were worsening. Uber posted a $761 million profit during the January-March period under the same metric, more than quadrupling from a year ago.

Thats one of the key reasons that Lyfts stock has lost two-thirds of its value during the the past year while Ubers shares have climbed 20%.

The stark difference led Green, Lyfts long-time CEO, and fellow co-founder John Zimmer to step down from day-to-day management to make way for Risher, best known for helping lay the foundation Amazons e-commerce empire as the companys top U.S. retail executive in its early days. His contributions were so significant that Amazon founder Jeff Bezos wrote him a thank you note thats posted on the companys website as a permanent tribute.

But before Lyft asked him to take over as its CEO, Risher had spent more than a decade running Worldreader, a non-profit organization devoted to helping young children learn to read.

That made Risher seem like a puzzling choice to many investors wondering what can this guy do, White said. Wall Street doesnt know a ton about him.

Rishers hiring initially spurred speculation that he may be grooming Lyft for a sale, but he doesnt think that makes sense while the company is still struggling.

Lets put it this way: We will be more valuable as a partner of any type organization if we have a business thats 10 times bigger and profitable, Risher said.

Risher, 57, will make a huge windfall if he can turn things around. Besides paying Risher a $3.25 million signing bonus on top of a $725,000 salary, Lyft awarded him an incentive package consisting of 12.25 million shares of stock that will vest when the shares hit a range of staggered price targets. If Lyfts stock rises from its recent price hovering around $10 and hits nine targets ranging from $15 to $80, Risher will reap about $980 million, estimated the investment research management firm VerityData.

For now, Risher is focused on ensuring Lyft remains a viable alternative to Uber.

There was a loss of Lyft relevance, Risher said. So now it becomes our challenge to say, Hold on, were back and we are a really important choice.

Trading in both firms triggered multiple volatility halts as PacWest fell 28% to close at a record low while Western Alliance tumbled 15%. The pair has shed more than $5 billion in market value so far this year. The KBW Regional Banking Index dropped 5.5% on Tuesday, the most since the crisis that engulfed Silicon Valley Bank in March.

Charles Schwab Corp., a brokerage with a banking arm thats come under pressure in the recent rout, fell 3.3% amid the broader selloff in financial stocks. Comerica Inc. and Zions Bancorp. each tumbled more than 10% while Metropolitan Bank Holding Corp. dropped 20%.

The turmoil comes a day after JPMorgan Chase & Co.s Jamie Dimon said the current banking crisis is nearing its end after his banks purchase of First Republic, though he acknowledged its possible another small lender could fail. The regional bank gauge is already down 28% so far this year. 

The resolution of First Republic helps to ease concerns but not eliminate them, Wells Fargo & Co. analyst Mike Mayo said in an interview. A triple dose of negative sentiment is impacting the regionals: commercial real estate, diversification and regulation.

Western Alliance and PacWest are among a number of regional banks that investors have zeroed in on after the collapse of Silvergate Capital Corp., SVB Financial Groups Silicon Valley Bank, and Signature Bank in March. The turmoil demonstrated the threat posed to commercial lenders by asset-liability mismatches and uninsured deposits. 

Still, both Western Alliance and PacWest posted earnings results in April that appeared to appease investors, while indicating their deposit bases had stabilized or recovered after initial outflows in March.

Wall Street is wondering which bank could be the next one that needs a rescue and that is making it easy to pick on the other regional banks, said Edward Moya, Oanda senior market analyst. It looks like JPMorgans deal for FRC gave us one day of calm for the banking sector. Regional banking stocks are still looking vulnerable until we see clear signs that emergency lending programs can go away.

RBC Capital Markets analyst Jon Arfstrom wrote that the Tuesday swings in the regional bank stocks were unusual and his conversations with investors didnt indicate any new concerns. He recommended buying the dips in stocks including Comerica, PacWest and Western Alliance. 

In our view, unwarranted negative sentiment is continuing to drive elevated moves in these stocks, the analyst wrote. Our sense is that todays action is an amplification of ongoing fears as the market looks to digest the implications of the First Republic resolution and an overall more challenging longer term profitability outlook for the industry.

Part of whats driving bank shares down is the fact that many regional bank investors assumed the Federal Deposit Insurance Corp. would announce a change to deposit insurance alongside its announcements about the First Republic receivership process, said Gary Tenner, an analyst at DA Davidson. The level of uninsured deposits at Silicon Valley Bank and Signature played a key role in the bank runs that led to their downfall.

A lot of banks were recovering deposits or growing deposits at this point, Tenner said in a telephone interview. This is not fundamentally driven. Its more pressure on names now that there was no clear change in the deposit insurance.

Speaking Tuesday at the Milken Institute Global Conference, Wells Fargo & Co. Chief Executive Officer Charlie Scharf said that regulators functioned as they were supposed to in the recent turmoil. He said the majority of banks his firm is monitoring are strong.

Regulatory Response 

While idiosyncratic factors are at play in the recent collapse of regional lenders, their troubles can be traced back to higher interest rates raising their cost of funding while eroding the value of assets. As deposits have left the system for higher-returning vehicles like money-market funds, banks have loaded up on liquidity provided by the Federal Reserve and the Federal Home Loan Bank system. Those funds have kept banks liquid, but the high cost of funding is set to hurt profitability. 

While FRC resolution is a good sign, we havent had a clear solution to the lack of confidence across regional banks and may need a more holistic response from regulators or the government, Bloomberg Intelligence analyst Herman Chan said in a message.

Investors will start to take a pretty hard look at banks that have bellied up to the Fed and the FLHB, said Abbott Cooper, an activist investor who worked on deals for failed banks during the Global Financial Crisis.

Company executives for Fontainebleau Las Vegas made the announcement Tuesday morning, more than a year after the company publicly set a goal to open before the end of 2023.

In a statement, chief operating officer Colleen Birch said the long-awaited resort on the north end of the Strip represents a rich heritage of luxury hospitality, chic elegance and unforgettable experiences. The announcement marked the beginning of hiring efforts for a 3,700-room resort and casino that is expected to create thousands of jobs.

Named after Miami Beachs 1950s-era Fontainebleau hotel, the luxury resort is one of the tallest buildings in Las Vegas.

Construction on the 67-story Fontainebleau Las Vegas began in 2007 amid the U.S. real estate bubble and was expected at the time to open in October 2009, but work stopped when it went bankrupt during the Great Recession. The project stalled for years.

In the decade that followed the original projects collapse, ownership changed hands several times. In 2018, the resort even got a new name, Drew Las Vegas, after Steven Witkoff and Miami-based investment firm New Valley LLC bought it for $600 million. But the rebranded project was short-lived: Construction was suspended in March 2020, when the coronavirus pandemic triggered Nevadas statewide shutdown.

A year later, the blue tower project came full circle after it was reacquired by Jeffrey Soffer, one of the original Fontainebleau Las Vegas developers. At the time, Soffer estimated the property was 75% complete and said it was in mint condition.

We are grateful to have the opportunity to finish what we started and finally introduce the iconic Fontainebleau brand into one of the worlds largest hospitality destinations, Soffer said in late 2021.