Netflix share-price surged yesterday after US business magnate and billionaire Carl Icahn revealed that he has taken an almost 10% stake in the firm.
A filing with the US Securities and Exchange Commission yesterday showed Icahn has taken 5.54 million outstanding shares in the streaming business at a price of US$168.9m, putting him in charge of roughly 9.98% of the company’s stock.
The move saw Netflix’s share price surge during trading yesterday, settling at US$79.24, up 14%.
Detailing Icahn’s interest in the business, the filing said the businessman believes 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 filing added.
The news came after Netflix shares again climbed at the end of next week amid speculation that Microsoft could be exploring a takeover bid. Earlier in October, Netflix CEO Reed Hastings announced he would not seek re-election to the Microsoft board at its shareholders AGM next month, leading commentators to speculate an offer could be forthcoming.
Icahn is estimated by Forbes to have a net worth of some US$14.8bn and is listed as the 21st richest person in the US. His previous business interests include firms like Blockbuster, Time Warner and Yahoo!.