On the eve of Apple's (AAPL) earnings call Monday, activist investor Carl Icahn is pressuring CEO Tim Cook for an "unprecedented" $150 billion stock buyback that Icahn says would nearly double the value of Apple shares.

Icahn recently increased his stake in Apple by 22 percent -- from 3.87 million shares to 4.73 million shares -- and on Thursday unveiled a letter he wrote to Cook calling for the stock buyback.

Icahn's proposal would come on top of Apple's current plans to repurchase $60 billion worth of shares over three years.

In the letter that he posted on his new website, www.shareholderssquaretable.com, Icahn called Apple's $60 billion buyback "simply not large enough."

Shares of Apple closed at $531.91 Thursday, but Icahn wrote to Cook that a $150 billion stock buyback would drive Apple shares up to $1,250.

With $147 billion in cash on Apple's books, Icahn wrote, "we find it difficult to imagine why the (Apple) board would not move more aggressively to buy back stock by immediately announcing a $150 billion tender offer (financed with debt or a mix of debt and cash on the balance sheet).

"While this would certainly be unprecedented because of its size, it is actually appropriate and manageable relative to the size and financial strength of your company," he continued.


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Apple did not respond to a request for comment.

Icahn's letter followed a dinner meeting he had in September with Cook.

Icahn, who owns an estimated 9 percent of Dell, had been fighting to keep Dell public. But around the same time as his dinner meeting with Cook, Icahn wrote an open letter to Dell shareholders saying he no longer would challenge a buyout proposal from company founder Michael Dell and Silver Lake Partners.

Scott Rothbort, president of LakeView Asset Management, said Icahn's strategy with Apple is different from his intentions with Dell.

With Dell, Icahn "wanted to take over a company and install new management and re-engineer the company from top to bottom," Rothbort said. "With Apple, all he's saying is he wants to re-engineer the bottom line."

"If Tim Cook looks at him in a mentor role, as an elder statesman, it will be beneficial," Rothbort said.

But Gary Lutin, chairman of The Shareholder Forum, was involved with Icahn's efforts in the Dell takeover and warned Apple and its shareholders to regard Icahn with caution.

With Dell, Lutin said, "he got a lot of people to follow him, then he negotiated a settlement and didn't share whatever he got with them."

"He's making proposals the way he did with Dell," Lutin said. "He makes a proposal that appears to appeal to a large number of active traders as something that represents a potential value increase. And he knows that when he gets on TV, the stock price continues to fluctuate in a predictable manner and he's going to make a profit on that."

Contact Dan Nakaso at 408-271-3648. Follow him at Twitter.com/dannakaso.