As shares of Federated Department Stores rose for a second day, it became clear that Carl Icahn’s plan to purchase up to $500 million of stock in the retailer will bolster his stake in the company, but it won’t place him among the top five holders.
Shares of Federated rose 2.2 percent Thursday to $43.35, on average trading volume of 4.5 million.
Currently, the billionaire investor owns about 2.1 million shares, or 0.37 percent of the department store conglomerate. An additional $500 million shares would bring him close to 3 percent ownership. While this is a hefty stake, it doesn’t compete with major institutional holders of the retailer.
Topping the list, Fidelity Management & Research Corp. owns about 27.6 million shares, or 5.08 percent of the department store. Private Capital Management Inc. holds about 24.7 million shares, or 4.54 percent of the company. Rounding out the top three, Dodge & Cox has approximately 22.6 million shares, or 4.15 percent ownership.
Acquiring $500 million in shares would not place Icahn in a position where he can make a serious impact or have a significant input in Federated’s operation, said Walter Loeb, a retail consultant of the firm that bears his name.
While Icahn may not have much say in the inner workings at Federated, on Thursday he filed a heated proxy statement on another investment, ImClone System Inc. Icahn is looking to oust half of the ImClone board of directors.
Earlier this month, Icahn won three seats on the ImClone board and currently owns about 14 percent of the biotechnology company.
Icahn also holds seats on the board of Blockbuster Inc. and earlier this year unsuccessfully sought for a breakup of Time Warner Inc.