As retail stocks plummet, a corporate raider has surfaced, and at what better place than the annual Financo Merchandising Chief Executive Seminar and Dinner held Monday?

“You retail companies are in major stock trouble and that’s what I like,” said Carl Icahn, making a surprising first appearance at the 18-year-old event and bringing a touch of levity and a jolt of takeover talk to the industry gathering. It’s hosted each year by Financo chairman Gil Harrison at the Harmonie Club and without fail draws the captains of the industry, active and retired.

After a poor December, retailers are licking their wounds, and Icahn, who often takes stakes in retailers and puts pressure on the boards for change, smells blood.

“Things are bad now; they are going to get worse,” Icahn told the crowd of 300, referring to economic conditions. However, with the internal workings of retailers, he said he’s talked with chief financial officers of some of the majors and likes what he sees. “If you look at the god—n cash flow, they’re doing great. The one question I ask is, ‘Why aren’t you buying back your stock?’ Now is the time to look at these things. That’s why I came…and I love Gil.”

With Macy’s Inc. chief executive officer Terry Lundgren a no-show, Icahn saw fit to comment on the chain and the man who leads it.”He’s a lovely guy. I see him at the tennis matches, and say, ‘Terry, why aren’t you working?’

“As you know, we have a large position [in Macy’s] and have been losing a lot of money on it.” Still, with Macy’s slumping, and recently having announced a round of store closings, Icahn characterized the retailer as “a very good” company.

For complete coverage, see Wednesday’s WWD.

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