MENT pays Carl Icahn $146M

[Daniel Payne]

Back in 2010 activist investor Carl Icahn bought 16 million shares of MENT stock at $8-$10 per share in an attempt to take control of Mentor Graphics.

Today we learned that Mentor Graphics is buying 8 million of those shares from Icahn, so at $18.12 per share I calculate that Icahn just earned some $64M in profit. Nice deal of Icahn, and he still owns another 8 million shares of MENT stock. Had Icahn been able to time this better he could've sold at $28 per share when Mentor stock peaked, but then again maybe Mentor didn't want to buy back those expensive shares.

We've blogged about Icahn on SemiWiki:

• Personal Message to Carl Icahn RE: MENT. June 16, 2010
• Mentor Graphics Should be Acquired or Sold: Carl Icahn. Feb 12, 2011
• Mentor Graphics should be acquired or sold: Carl Icahn Counterpoint. Feb 20, 2011
• Mentor Graphics: 1: Carl Icahn 0!. Mar 4, 2011
• Mentor 2: Carl Icahn 0. May 1, 2011
• Shakeup at Mentor Graphics. May 12, 2011
• Bye, Bye Carl Icahn. Feb 26, 2015

 

[Pawan Fangaria]

Carl was expecting Apple to reach $1 trillion valuation. That doesn't seem to happen in any near future. Is he not selling Apple shares now? By the way, Mentor story has paid Carl handsome money amid so much activism by him.

 

[Daniel Payne]

Carl is just at the beginning of his greenmail extortion of Apple, so it's way to early to start selling Apple shares now.

Carl repeats his extortion in the following steps:

1) Identify a public company with under-performance

2) Buy stock in that company of several percentage points to gain attention

3) If needed, buy enough stock to place new candidates on the Board of Directors

4) Start a public campaign of shaming and putting down corporate management and decision making

5) Wait for the company to turn itself around by cost cutting measures or focusing only on winning market segments, selling off losing product lines

6) The stock market rewards the company by raising its stock price, the market also rewards most companies that Icahn has bought shares in

7) Carl sells his shares at a handsome profit, and has already moved onto the next victim corporation