UPDATE 1-Icahn picks up Mentor stake, to seek board discussion

* Icahn, entities acquire 7.3 mln shares in co

* To discuss company operations with board

* Share rise 10 pct in post-mkt trade

May 27 (Reuters) - Activist investor Carl Icahn reported a 6.86 percent stake in chip-design software maker Mentor Graphics Corp (MENT.O) and said he intends to discuss ways to maximize shareholder value with the management.

Shares of the company rose 10 percent in extended trade.

In a regulatory filing dated May 17, Icahn said he acquired the shares in the belief that they were undervalued.

Icahn, together with some of his investment vehicles like High River and Hopper Investments, hold about 7.3 million shares in the company.

Mentor Graphics competes with companies like Synopsys Inc (SNPS.O) and Cadence Design Systems Inc (CDNS.O) in the electronic design automation market, and is expected to report results on May 28.

For the first quarter, analysts expect the company to post a loss of 1 cent a share, according to Thomson Reuters I/B/E/S.

In its fourth-quarter statement, the company had said though the general business environment was improving, it was not confident about the sustainability of the recovery.

Shares of the Wilsonville, Oregon-based company have lost more than 10 percent of their value in the last month. They rose 47 cents to $10 in heavy volume play in trading after the bell. They had closed at $9.05 Thursday on Nasdaq. (Reporting by Sayantani Ghosh in Bangalore; Editing by Saumyadeb Chakrabarty)