updated 05:33 pm EDT, Wed October 31, 2012
Report fuels Netflix takeover speculation by Microsoft, others
Financier and corporate raider Carl Icahn has reported to the Securities and Exchange Commission (SEC) that he owns approximately 10 percent of Netflix stock. The filing declares that Icahn Capital LP and associates purchased 5.54 million shares of stock in the company for $168.9 million dollars. In remarks associated with the announcement, the investment group believes that Netflix is undervalued.
According to the SEC filing, "the Reporting Persons acquired the Shares with the belief that the Shares were undervalued due to the Issuer's dominant market position and international growth prospects. The Reporting Persons believe Netflix may hold significant strategic value for a variety of significantly larger companies that are engaging in more direct competition with one another due to the evolution of the internet, mobile, and traditional industry. The Reporting Persons are considering ways for the Issuer to maximize shareholder value but have reached no conclusion. The Reporting Persons may in the future seek to have discussions with the Issuer."
As a result of the SEC filing made public, Netflix shares jumped $10 on the news, making it the second day in less than a week that the stock has risen more than 10 percent. The first climb was attributed to rumors that Microsoft had offered $90 per share in an acquisition bid for the video streaming company.