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Image Entertainment, Nyx Acquisitions Sign Fourth Merger Amendment

15 Apr, 2009 By: Erik Gruenwedel

Image Entertainment

Patience by Image Entertainment continues to be lucrative, this time by the payment of $1.5 million.

The Chatsworth, Calif.-based packaged media distributor April 15 signed a merger agreement amendment with Nyx Acquisitions, an affiliate of Q-Black LLC in San Francisco, which delayed closing of the $100 million deal until April 20. The acquisition, approved by Image shareholders in February, calls for Nyx to pay $2.75 per share in cash ($60.2 million), in addition to assuming all outstanding debt, for a total purchase price of $100 million.

Pursuant to the fourth amendment, Nyx said it would deposit $1 million into a business interruption fee account by noon April 17. More importantly it agreed to release to Image the current $1.5 million in the account. Image March 24 received $1 million from the business interruption account in connection with the execution of the second amendment to the merger agreement.

Nyx has the option to delay closing of the acquisition until May 4, provided it requests permission to do so by April 16 and pays $3 million into the business interruption fee account by April 20.

Despite the apparent absurdity of the roller coaster negotiations, one analyst following the deal said investors remain optimistic for a conclusion underscored by Nyx’s previous payments of $2.5 million into the account.

“It seems like [Nyx] has intentions to do it, I just don’t know if they can get the money together,” said the analyst, who wished not to be identified due to the ongoing negotiations.

Image shares closed up more than 14% to $1.46 per share.

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