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Icahn Backs Off Apple Buyback Proposal

The activist investor Carl C. Icahn on Monday backed away from his nonbinding proposal that Apple Inc. increase its stock buybacks to $50 billion after running into increasing opposition from other shareholders and a top proxy advisory firm.

The proposal had become the focus of a brewing battle over Apple and its $159 billion war chest. The company has already committed to spending roughly $100 billion over the next two years on stock repurchases and dividend payments.

Mr. Icahn, who began amassing shares in Apple last summer, has aggressively pushed the company to pay that money out to shareholders through a huge buyback by late September. But other investors have argued that his plan put too many restrictions on the company’s management and board.

In an open letter posted to his website on Monday, Mr. Icahn cited aggressive stock repurchases by Apple, including spending $14 billion in recent weeks, as evidence that the company was moving to pay out more of its enormous cash pile to investors.

“We see no reason to persist with our nonbinding proposal, especially when the company is already so close to fulfilling our requested repurchase target,” he wrote.

Mr. Icahn acknowledged opposition to his proposal by Institutional Shareholder Services, an influential adviser to investors. In a note to clients on Sunday, the firm wrote, “The board’s latitude should not be constricted by a shareholder resolution that would micromanage the company’s capital allocation process.”

Even still, Mr. Icahn noted that I.S.S. criticized Apple for being “sluggish” in returning excess cash to shareholders and that the company’s current plan amounted to bailing out a big ship with “a leaky bucket.” In its report, the proxy adviser called for a long-term plan for dealing with thecompany’s quickly replenishing cash hoard.

Others have opposed Mr. Icahn’s proposal as well, including New York City’s comptroller, Scott M. Stringer, and Calpers, the giant California public pension fund. Mr. Stringer told DealBook on Sunday that he thought Apple was in a better position to determine its financial future than one outspoken activist investor.

Here’s a celebratory message that the comptroller posted to Twitter on Monday: