Icahn Sees "Once In A Generation" Distressed Debt Buying Opportunity

In a letter to investors obtained by The NY Post, Carl Icahn said he sees a "once in a generation" opportunity to buy distressed debt. It appears Icahn will continue to buy up companies, but instead of buying the equity, he'll likely buy the debt.

"Credit investments are becoming a larger percentage of the portfolio and we expect these investments to be a larger driver of returns this year than in years past," the letter said.

Icahn owns debt in companies like MGM Mirage (NYSE: MGM) and Lionsgate (NYSE: LGF) and he's likely looking at other opportunities, but did not disclose them in his investment letter.

The Post also reported that Icahn will likely be active in Yahoo's (Nasdaq: YHOO) and Motorola's (NYSE: MOT) debt this year.

Icahn Partners, a unit of the $4.9 billion Icahn Capital, returned 4.1% net of fees for the three months ended March 31.

Lastly, in Icahn's letter, he mentioned that Yahoo!'s new CEO, Carol Bartz, "has the company pointed in the right direction" and that "a strategic deal with Microsoft (Nasdaq: MSFT) is still in the best interest of Yahoo! shareholders."

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