Billionaire Carl Icahn’s conversation with Family Dollar has gotten off on the wrong foot.
The activist investor told The Post he took it as an “insult” after the dollar-store chain adopted a “poison pill” provision to block him from buying more shares in the company.
Icahn, who disclosed late Friday he has taken a 9.4 percent stake in Family Dollar, signaled in a securities filing that he may push for operational changes, strategic alternatives and possibly board seats.
But Family Dollar — whose chairman and CEO, Howard Levine, is the son of the company’s founder — responded Monday by capping the number of shares any investor could amass in the retailer at 10 percent.
“A 10 percent poison pill does nothing but enhance legal fees and is a basic insult to shareholders’ rights,” Icahn told The Post in a Monday interview. “It’s great for lawyers’ fees, but it’s not exactly friendly.”
Family Dollar said Morgan Stanley is its financial adviser, while Cleary Gottlieb is acting as its legal counsel.
Icahn’s move juiced investors, who sent Family Dollar shares up 13.4 percent on Monday to $68.62.
Icahn isn’t the first billionaire cage rattler to “shop” at the 7,963-store Charlotte, NC, chain.
Nelson Peltz’s Trian Partners owns a 7.4 percent stake. It tried unsuccessfully in 2011 to jump-start a sale of the retailer by offering $60 a share.
Peltz backed off when no other bidders emerged, and Family Dollar gave a board seat to Peltz’s son-in-law Edward Garden — who was the sole director to vote against the poison pill.
Deep-pocketed John Paulson’s hedge fund owns a 6.5 percent Family Dollar stake, but has remained largely silent about his investment.
“The likely end game is that private equity would be involved,” said Mark Montagna, an analyst at Avondale Partners, when asked about the prospects of Family Dollar getting sold.
Investors have long speculated that Family Dollar might get acquired by archrival Dollar General, the 11,250-store deep discounter based in Goodlettville, Tenn.
Montagna notes that Dollar General has repeatedly said it is focused on expanding its own chain.
Nevertheless, some analysts say it could still make sense for Dollar General to consider snapping up its smaller rival. In a report last August, Credit Suisse said Family Dollar could be “relatively attractive” to Dollar General at the $90 to $100 level.
Dollar General shares rose 7.4 percent to $62.25.
Walmart has also been cited as a possible acquirer of Family Dollar, but large acquisitions have not been typical with the world’s biggest retailer, which is rolling out about 300 smaller stores called “Walmart Express.”
Jefferies & Co. raised its ratings on Family Dollar and Dollar General to “buy,” citing a potential merger and synergies.
“We think Dollar General could be a motivated buyer given where we are in the life cycle of this dollar-store industry,” analyst Daniel Binder wrote in a note.