As famed investor Carl Icahn does battle with Yahoo this week in an attempt to usher a merger with Microsoft, tensions are also mounting between Icahn and shareholders of XO Holdings, who fear his treatment of that company’s debt could drive it to bankruptcy.

Icahn, who is both XO’s Chairman and its majority shareholder, also controls nearly all of its $461 million in debt, which begins to mature next year. As the company mulls options for refinancing and paying down that debt in a turbulent credit market, some shareholders have criticized Icahn for not allowing XO to refinance that debt earlier, when the credit market was much healthier.

On Thursday R2 Investments, which owns 6.6% of XO’s common stock (more than 11 million shares) wrote a letter to Icahn expressing concern over the possibility that Icahn could seek to use his debt holdings to secure more ownership of XO in bankruptcy court. Should XO file for bankruptcy, the group warned it would argue in court that Icahn as a debt-holder should be given the same, or less, consideration as minority shareholders, given that Icahn’s actions “have significantly prejudiced the other creditors and shareholders.”

“We are very concerned…that as your XO debt matures, you will continue to use your position as chairman of the board and majority shareholder of XO to try to obtain all of XO's revenue-generating assets for yourself to the detriment of XO's minority shareholders,” R2 wrote in the letter.

The group called for Icahn to resign from XO’s board, place his stock in a blind trust and butt out of XO’s daily operations.

XO did not reply to a request for comment, but in the past, the company has denied suggestions that its chairman’s interests were at odds with those of shareholders.

Conflicts between Icahn and minority shareholders have been simmering for years. In late 2005, XO agreed to sell its CLEC business (separated from its wireless business) to an entity owned by Icahn for $700 million -- a move XO’s CEO hailed at the time as one that would render the company debt-free. But the deal was cancelled after shareholders filed multiple lawsuits to block it, arguing that XO didn’t do enough to seek competitive bids. At the time, an XO spokesman denied that charge, saying about 40 potential bidders examined the assets.

R2 cited the episode in its letter to Icahn this week, claiming that, had the deal been consummated, “You would have succeeded in taking XO's revenue-generating assets for yourself.”

As the search for new financing drags on and the maturity date draws nearer (a special committee of directors has said it would “encourage” management to settle on a plan by late summer or early fall), some investors believe that is still Icahn’s goal.