Carl Icahn’s latest activism targeted on Netflix has not been well received by the company. After Icahn reported his nearly 10 percent share in the company’s stock, Netflix, Inc. (NASDAQ:NFLX) has decided to guard itself against a possible takeover. The plan, commonly called as poison pill, is essentially meant to stop Carl Icahn from taking his nearly 10 percent share to over 10 percent. The plan will make Netflix, Inc. (NASDAQ:NFLX)’s shares so expensive in the open market that acquiring a controlling share in the company’s stock will become difficult. According to the company, the plan is meant to protect the shareholder interests.
“Adopting a rights plan is a very reasonable thing to do in light of the recent, and stealth, accumulation of stock and options by an activist investor,” said a Netflix, Inc. (NASDAQ:NFLX) spokesman.
David Einhorn's Greenlight Capital returned -2.9% in the second quarter of 2021 compared to 8.5% for the S&P 500. According to a copy of the fund's letter, which ValueWalk has reviewed, longs contributed 5.2% in the quarter while short positions detracted 4.6%. Q2 2021 hedge fund letters, conferences and more Macro positions detracted 3.3% from Read More
In relpy, Carl Icahn has sent some poison of his own to company’s board, in the most recent SEC filing. The 13D in which he calls the actions ‘troubling, discriminatory, and an example of poor corporate governance.’
On Oct 31, Carl Icahn disclosed a 9.98 percent stake in the company, 1 percent direct, and the rest in options. He directed criticism at the company’s undervalued stock value and hinted on a buyout for the video streaming and DVD company. Netflix, Inc. (NASDAQ:NFLX)has previously said that it would like to work with Icahn, but then suddenly took a u-turn. The company has been struggling in the past quarters and Carl Icahn’s last comments were liked by the market where Netflix rose 14 percent. There are some analysts, like Wedbush, who still see potential in the company. Carl Icahn is not one to lie low, we have to wait and see how this latest tug of war culminates.
Shares of Netflix have been more or less flat in trading after this news broke today.