Icahn pledged to wage a proxy fight to elect a board of directors committed to spinning off the company's Nabisco food unit instead.
"I believe that the marketplace would place a proper valuation on Nabisco as a free-standing company, separating it completely from RJR rather than having it controlled by a holding company that once owned a tobacco company," said Icahn, who owns about 6.6 percent of the company (RN).
Icahn had been critical of CEO Steven Goldstone's delays in breaking up the company, but Goldstone answered his critics when he announced Tuesday that he'd arranged to sell the company's international tobacco operations to Japan Tobacco Inc. for $8 billion. Goldstone also announced that the U.S. tobacco operations would be spun off to shareholders into a separate company.
Icahn wants the food units spun off instead to protect them from the potential liability of tobacco-related litigation - a restructuring that one analyst suggested was unlikely.
"I very much doubt" Icahn will be successful, said Martin Feldman, tobacco analyst for Solomon Smith Barney. "He's gone to all the trouble of putting together a slate. He can withdraw it at any time, or he can sell his stock at any time."
Feldman said shareholders will likely vote against Icahn's slate at the May 12 shareholders' meeting. "When he closes those two transactions, the total value to shareholders will be $40 [a share] vs. the current $30," he said.
Written By Rex Nutting, CBS MarketWatch