The Wall Street Journal: Icahn contests bid to take AmTrust private, sending shares surging

Activist investor Carl Icahn is contesting an attempt by the primary owners of AmTrust Financial Services Inc. to take the company private, saying the company hasn’t treated its public shareholders fairly.

In a letter to AmTrust Thursday, Icahn says the Karfunkel and Zyskind families, which control the New York workers’ compensation insurer, are “blatantly taking advantage” of the company’s minority shareholders. Icahn disclosed Thursday that he owns a 9.38% stake in AmTrust AFSI, +0.60%   and says the company’s board should push back a shareholder vote on its $2.7 billion going-private deal, which is currently scheduled for June 4.

Icahn said AmTrust “stealthily” set a record date of April 5 for voting on the transaction but didn’t tell shareholders or the market about it. That had the effect of disenfranchising investors who bought tens of millions of AmTrust shares since then with the expectation that they would be able to vote on the deal, Icahn said. “Such a vote is absurd and devoid of fairness,” Icahn said. He said he is assessing his legal options “to correct the manifest injustice that will occur if the board fails to change the record and special meeting dates.”

AmTrust shares jumped in after-hours trading on the news. Shares were trading after hours at $14.25, up 6.1% since Thursday’s close and moving above the $13.50 price offered in the going-private deal. The shares gained 0.6% in regular trading Thursday.

An expanded version of this report appears on WSJ.com.

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