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(CNN Business) —  

Carl Icahn is no stranger to risk-taking. But even the legendary investor is uncomfortable with his exposure to Occidental Petroleum’s giant pile of debt.

Icahn has been at war with Occidental’s (OXY) board and management since the oil driller borrowed heavily this past spring to pay for its controversial acquisition of rival Anadarko Petroleum. The deal, valued at about $58 billion including debt, is the second-biggest takeover of a US oil-and-gas company, according to Dealogic.

Last week, Icahn disclosed he has sold a third of his stake in Occidental because of worries about the company’s balance sheet. The billionaire is now signaling he might not be done selling.

“If I don’t think I can win a proxy fight and replace the board, I might sell more,” Icahn told CNN Business during a phone interview.

Icahn still owns about 23 million shares in Occidental, a stake valued at nearly $900 million, according to a letter he wrote to shareholders late last week.

And even though he remains one of Occidental’s largest shareholders, Icahn warned that holding onto the stock is risky because of problems he sees with the company’s corporate governance.

“Owning this company, and being at the mercy of a board and CEO who have already shown they are willing to take inordinate risks and gamble stockholders money to further their own agendas, is extremely dangerous for an investor,” Icahn told CNN Business.

Occidental’s share price has tumbled 38% since April 23, the day before the company entered a bidding war against Chevron (CVX), which had already reached a merger agreement for Anadarko. That stock drop far exceeds the 14% decline in US oil prices over that span. However, other oil drillers have struggled as well and the SPDR S&P Oil & Gas Exploration & Production ETF is down 32% since April 23.

Occidental races to raise cash

Icahn has argued the Anadarko deal was flawed on two levels. First, he believes Occidental took on more than it could swallow, forcing it to turn to billionaire Warren Buffett for help. Buffett’s Berkshire Hathaway (BRKA)agreed to provide $10 billion in equity financing, but on terms that analysts and shareholders felt were very expensive for Occidental.

Second, Icahn has suggested Occidental bought Anadarko for the wrong reason: to make itself so large that it couldn’t be taken over by a mega oil company like ExxonMobil (XOM) or Chevron.

“I’ve seen some pretty bad situations with corporate managements and boards trying to protect themselves, but rarely have I seen one this bad,” Icahn said in the interview. “They grossly overpaid for Anadarko and have risked the company and stockholders’ money. In the army, they would be court-martialed.”

Occidental did not respond to a request for comment.

However, Occidental CEO Vicki Hollub has repeatedly defended the Anadarko deal as a smart way to gain scale in America’s shale oil boom, particularly the red-hot Permian Basin of West Texas. She has argued that gathering land in the Permian and applying Occidental’s technology will pay off in the long run — especially if oil prices rise.

Hollub has vowed to rapidly repair Occidental’s balance sheet, including by raising $10 billion to $15 billion through asset sales. The company recently fetched $3.9 billion by unloading Anadarko’s liquefied natural gas properties in Mozambique.

“We’re very intent on ensuring that we get the asset sales done because we believe we must get our debt down,” Hollub said last week during a conference call with analysts.

’Extremely uncomfortable’

Occidental may not be done raising cash by auctioning off Anadarko assets. Occidental is also seeking to raise $700 million by selling oil and gas properties in Wyoming and Colorado, Reuters reported this week.

In a letter to shareholders, Icahn warned of a fire sale at Occidental where the company’s debt woes force it to accept bids that undervalue its assets.

Hollub said Occidental is approaching asset sales “very aggressively,” but “we’re not compromising on the value that we can get from those assets.”

To further soothe shareholder concerns, Occidental is slashing its spending. The company released a 2020 capital budget of $5.3 billion to $5.5 billion. That’s down by $3.6 billion from what Anadarko and Occidental spent this year.

Icahn wrote in his letter that Wall Street has “completely lost faith in Hollub and her board” — a sentiment he said he shares. However, the activist investor has stopped short of calling for Hollub to be removed, only saying this is something that should “potentially” be considered.

Icahn is hardly the only one sounding the alarm about Occidental’s balance sheet.

Energy investment bank Tudor, Pickering, Holt & Co. slapped a “sell” rating on Occidental on Monday because of worries about the company’s “elevated” leverage.

The firm estimates that Occidental’s net debt and preferred stock will total 4.2 times its adjusted earnings at the end of 2020. That’s nearly four times the average leverage ratio among large oil companies.

Tudor, Pickering analyst Matt Portillo wrote in the report that the “overwhelming” amount of debt and preferred stock issued to win control of Anadarko leaves Occidental’s balance sheet “in an extremely uncomfortable position.”