Carl Icahn's fortune jumps by $1 billion as new loan agreement boosts his company's stock 22%

• Shares in Icahn Enterprises rose as much as 22% Monday as Carl Icahn amended loans.
• The loans were tied to the company's share price, and a point of criticism by Hindenburg Research.
• The new agreement largely separates the stock price from the loans.

Carl Icahn saw his wealth swell by $1 billion Monday after he amended a personal loan agreement with his flagship company Icahn Enterprises.

Under the new arrangement first reported by the Wall Street Journal, the billionaire investor's loans are no longer tied to the company's stock price.

The trigger for a margin call is now the net asset value of Icahn Enterprises' businesses instead of the market value of its shares. 

The news caused IEP stock to surge as high as 22% on Monday. Icahn, who holds an 85% stake in his namesake company, now has net worth of $11 billion, according to the Bloomberg Billionaires Index, still far below its February peak of $15 billion.

IEP was targeted by short-seller Hindenburg Research, and suffered a sharp slump in May. Among Hindenburg's accusations, Icahn was reported to be at risk of margin calls that would force him to sell 100 million shares in IEP as loan collateral, if the firm's stock price were to ever fall. 

But with the new agreement, Icahn has converted the margin debt into a three-year term loan, in a deal struck with five major banks. Though the stipulations tied to the IEP share price have been removed, Icahn is committed to add collateral if the firm's net asset value falls below a predetermined amount.

To reach the deal, Icahn has had to pledge 95% of his outstanding IEP shares, and has agreed to make a $500 million principal payment before September. 

Additionally, Icahn has been asked to pay $87.5 million in quarterly principal payments starting September 2024, repaying the final $2.5 billion principal in 2026.