Billionaire investor Carl Icahn has bought as much as 3.6 percent of Yahoo and is considering mounting a proxy fight for the Internet portal, according to people who have spoken with him, CNBC reports.

Icahn, who is known to exert pressure on company management where he holds investments, began building a significant position in Yahoo that may be as much as 50 million shares, sources told CNBC. Yahoo has about 1.38 billion shares outstanding.

Shares of Yahoo rose $1.17, or 4.63 percent to $26.43 at 3:02 p.m. in New York.

Last month Microsoft abandoned a $47.5 billion, or $33.00 per share bid for Yahoo, after the companies held talks but were unable to reach a deal. Microsoft had considered launching a proxy fight for the company by asking shareholders for cooperation but decided against it.

Icahn has not been able to confirm that Microsoft will renegotiate if all or part of Yahoo's board is replaced, CNBC said. The deadline for a proxy fight is on Thursday.

Early this year BEA Systems accepted a buyout from Oracle Corp after a protracted courtship. Icahn, who was BEA's largest shareholder had continuously pushed for a deal.