Why Carl Icahn is capable of forcing a sale? Netflix is under attack

Carl Icahn has purchased more than 10% in the video rental service, a slowdown is certain for Netflix CEO Reed Hasting and the corporate raider. When Icahn takes a stake in a certain company, sales ensue. He joined the board of directors of Blockbuster in 2005. By the time he left, he had lost more than 95 m dollars and some say he made the company bankrupt. Icahn, however, made 75m dollars with his investment in Time Warner, another 5 million in Lionsgate (2011) and additional 100 million on Take-Two.

Carl Icahn is not directly saying what he thinks but he is of the opinion that other companies will be interested in purchasing the leading streamer of premium content. This boasts around 30 million subscribers.

"It makes a great acquisition candidate because of their subscription base," Icahn said. "But it should be up to the shareholders, not the board, to decide that." The shares of Netflix sold for 77.90 dollars and sported a market capitalization of 4.33 billion dollars. Carl purchased his stake for an average of 60 dollars per share and has made 108 million dollars from profit so far.

The plan called “poison pill” is manifested in the sense that shareholders can buy a preferred stock if Icahn acquires 10% of Netflix.

"I don't know Reed Hastings," he says. "We're gonna meet. I can't tell you when, but we're gonna meet soon. I'm a little unhappy concerning what happened with the poison pill. It's an abrogation of corporate governance. There's just no reason for it." Even though there was a surge in the stock on the last day of October and Icahn’s stake, which is about twice than Hastings’) was disclosed, the shares of Netflix have fallen 75% for 18 months.

Carl Icahn added: "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.”