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Aug 24 (Reuters) - Cheniere Energy Inc, on track to be the first U.S. company to enable the export of liquefied natural gas (LNG), named two Icahn Capital LP managing directors to its board, days after activist investor Carl Icahn took a stake in the company.
Icahn reported an 8.2 percent stake in Cheniere earlier this month. He had said the stock was undervalued, and that he planned to talk to the company's management about operations, capital expenses among other issues.
Cheniere said on Monday it appointed Jonathan Christodoro and Samuel Merksamer to its board, increasing the size to 11.
"While Icahn has not specified what particular changes he plans to seek at Cheniere, the amicable agreement to add board members is certainly a better outcome than a proxy fight would have been," Raymond James analyst Luana Siegfried said.
Cheniere's Sabine Pass LNG terminal in Louisiana is expected start exports in mid-December, making it the first LNG export terminal in the lower 48 U.S. states.
LNG projects are subject to a tough approval process by the U.S. Energy Department, which gauges the possible impact of each project on the domestic gas market and on the environment.
Cheniere is building another LNG export terminal in Corpus Christi, Texas. It is also developing a $550-million terminal in Texas to ship processed condensate. That is slated to start in 2017.
Icahn can help bring "clarity" to what the company does with the excess cash flow it will start generating from 2017, said Seaport Global Securities analyst Sunil Sibal.
Cheniere's free cash flow - defined as cash that a company is able to generate after putting aside money to maintain or expand its asset base - has been negative for the past twenty quarters and was negative $4.59 billion as of June-end, according to Thomson Reuters data.
"Also capital spend for new projects by Cheniere could also be tightened, especially as we see global growth expectations being ratcheted down," Sibal said.
Asian firms, including Japanese utilities Tokyo Gas and Osaka Gas as well as India's Gail, are dialing back on their U.S. LNG commitments via stake sales after realizing they cannot handle the initial surge of volume due to low demand at home.
Christodoro, a manager director at Icahn Capital since 2012, also serves on the boards of companies including PayPal Holdings Inc, American Railcar Industries Inc, Hologic Inc and Herbalife Ltd.
Merksamer, who has been at Icahn Capital since 2008, serves as a director on the boards of Transocean Ltd, Hertz Global Holdings Inc and Navistar International Corp .
Icahn has previously agitated for change at energy companies including Chesapeake Energy Corp, Transocean Inc N> and CVR Energy Inc.
Cheniere's shares were marginally higher at $62.02 in afternoon trading, bouncing back after hitting a 52-week low earlier in the session amid a broad sell-off in the U.S. market.
(Reporting by Anannya Pramanick in Bengaluru; Editing by Savio D'Souza)