Carl Icahn has turned up the heat even higher on Mentor Graphics.
The activist hedge fund manager said in a regulatory filing that on Tuesday, he and others from his group met with the Chief Executive Officer and other representatives of the electronic design firm, explaining why they believe shareholder value would be greatly enhanced if the company were put up for sale in an open and fair auction process. They also said they believe there would be several interested strategic buyers who could pay "a substantial premium" for the company."
Icahn added that company representatives stated that they would take the matter under advisement with the board of directors and get back to him.
Icahn, who owns 15 percent of the company's stock, earlier said in a regulatory filing the company "should put itself up for sale." He added that a strategic acquirer should find extremely attractive the fact that the company spent $407 million on SG&A--$313 million on marketing and selling expenses and $94 million on G&A--over the last 12 months.
In a separate filing, Icahn earlier said he informed the company that he intends to nominate three individuals to the company's board at the 2011 annual meeting, but may nominate a different number of individuals, up to a full slate. He said this decision is in response to the company's announcement last week that it will hold its 2011 annual meeting six weeks earlier than last year, leaving shareholders with only 10 days to nominate a dissident slate.
Icahn, however, has competition. Casablanca Capital LLC, headed by Donald Drapkin, a former Vice Chairman of Lazard International and one-time key advisor to Ronald Perelman, and Douglas Taylor. Taylor said in a regulatory filing Casablanca owns
5.5 percent of Mentor's stock.
Earlier this week, Casablanca said it will nominate three individuals to Mentor's Board of Directors: Drapkin, Arthur Becker and Michael Barr.
Pull up a chair and start the popcorn machine. This should be a fun one to watch.