Things are heating up at Blockbuster
Icahn has never shied away from taking a stand -- and then profiting from that stand. As Tom Taulli wrote back in February, when the renegade investor had his sights set elsewhere, "Icahn is a billionaire for a very good reason: He has a tremendous ability to find undervalued stocks -- and to agitate companies to realize the value gap."
His bid to name himself onto the Blockbuster board of directors -- along with two entertainment-industry veterans as allies -- was vindicated in part when Institutional Shareholder Services threw its support behind two of Icahn's board candidates. Yet in supporting Strauss Zelnick and Edward Bleier, ISS did not endorse Icahn himself.
Last night, the Blockbuster Franchise Association announced that it was backing the incumbents. This was never a given. Between Blockbuster's questionably awkward "No Late Fees" campaign and its aggressive online efforts that may ultimately cannibalize sales at the store level, the franchises had good reason to turn their back on the current leadership. But they did not.
Still, that doesn't mean that Icahn's leaf-rustling won't bear fruit. Some believe that Blockbuster concededHollywood Entertainment
We also have the online price war with Netflix
Over the next few days, the battle should intensify. No, Icahn is not a saint, but he has an uncanny knack for spotting bargains and stirring the pot until fair value is realized. Given Blockbuster's deteriorating financials and the sector's quickly changing landscape, it's hard to value the company based on its future prospects. With or without Icahn -- and with or without CEO John Antioco at the helm -- this is no easy fix. It's why the franchise owners prefer the stability of Antioco. Yet shareholders may have something else in mind.
Rustle, leaves, rustle.
Some recently rented headlines:
- Yes, they sure are brawling at Blockbuster these days.
- Carl Icahn has been a successful corporate raider for decades.
- Blockbuster has to find a way to make its online and offline worlds jell.
Longtime Fool contributor Rick Munarriz can't remember the last time that he stepped into a Blockbuster store. He owns shares in Netflix. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.