(Bloomberg) -- Billionaire activist investor Carl Icahn’s investment fund is cutting its dividend payout by half as it plans to boost its stake in CVR Energy Inc.

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Icahn Enterprises LP will distribute a dividend of $0.50 per depositary unit in the third quarter, down from $1 per unit in the second quarter, according to an earnings statement on Friday. The firm is planning to raise its CVR Energy holding to about 81%, from 66%, it said in a separate statement.

IEP will launch a tender offer to buy as many as 15 million additional CVR shares for $17.50 apiece, the statement showed. The price represents a 5.9% premium to CVR’s last close in New York.

Texas-based CVR Energy saw its shares tumble 24% on Oct. 29 after the refiner suspended its cash dividend for the third quarter. Bloomberg Intelligence analyst Brett Gibbs called the move a “major blow” as its annualized dividend yield had led refining peers. CVR Energy’s shares have slumped 45% so far this year through Thursday, giving the company a market value of about $1.7 billion.

IEP said it believes that CVR Energy’s shares are undervalued and represent an attractive investment opportunity.

“Rarely have I seen a stock market with such extreme valuations – with some companies trading at unjustifiable premiums and others being massively undervalued,” Icahn said in the statement. “These undervalued situations have created great opportunities for activists.”

The dividend cut is also intended to help fund other investment opportunities within and outside the IEP portfolio, Icahn said.

IEP reported third-quarter revenue of $2.79 billion, down 7% from the same period in 2023. Adjusted earnings before interest, taxes, depreciation and amortization dropped 25% from a year earlier to $183 million. The fund’s indicative net asset value stood at about $3.6 billion as of Sept. 30, a decrease of $423 million from the end of the previous quarter, as positive investment performance was offset in part by the decline in CVR Energy.

Icahn and IEP reached a settlement with the US regulator earlier this year with a $2 million combined fine on insufficient disclosure on Ichan’s pledging with IEP shares. The settlement was on the back of a Securities and Exchange Commission’s investigation after a report by short-seller Hindenburg Research accusing the firm of inflating asset prices.