Wednesday, October 31, 2012

Netflix, Inc. (NASDAQ:NFLX): Ichan Takes 10% Stake, Stock In Action, Who Might Bid?

Netflix, Inc.(NASDAQ:NFLX) stocks have spiked this afternoon after Carl Icahn an investor has disclosed that he has taken a 9.98% bet in the company’s common stock in an SEC filing. He thinks that the company is ripe to be acquired.

In his 13D filing, Ichan has reported that he purchased the shares based on the logic that the stock is undervalued given the governing market position of the company and international growth prospects.

He added that the company could offer crucial strategic value for a variety of exceptionally larger companies in more direct competition with one another due to the evolution of the traditional, mobile and Internet industry.

The filing also reveals that Ichan is taking into account ways for Netflix to capitalize on shareholder value but have reached no ending. He added that he may seek discussions with Netflix in the future.

It was last week when shares of Netflix had spiked on rumors that Microsoft might be thinking over a bid. The report came a few weeks after CEO Reed Hastings had taken the decision of not seeking re-election to the Microsoft board. The DealReporter wrote that Microsoft is not planning on buying Netflix.

So the question is – who might want to place a bid for Netflix?

Over the years, there have been repeated speculations regarding Amazon making an offer for the company, but the hesitant block analysts always have increased is that the many locations that distribute DVDs for Netflix would compel Amazon to assess sales taxes on customer in states where they previously had no physical existence.

Google is equally expanding its content offerings in Google Play. Also, Comcast may want to jump into video streaming game arena giving the company a way to reach customers not in their cable footprint. Apple too could want to look at its piggy bank and purchase Netflix with pocket change.

Shares of NFLX jumped 13.75% to end the day at $79.15 after hitting session high of $84.95.

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