Lionsgate Board Again Rejects Latest Icahn Offer9 Sep, 2010 By: Erik Gruenwedel
The tug-of-war between Lionsgate and Carl Icahn took another predictable turn late Sept. 8 after the mini-major’s board again urged shareholders to reject the activist shareholder’s most recent offer to acquire outstanding shares for $7.50 per share.
New York-based Icahn Sept. 1 upped his $6.50 per share bid $1 predicated on a favorable ruling by a Canadian judge in a separate lawsuit Icahn filed against Lionsgate in July, according to a regulatory filing. Specifically, Icahn alleges the studio entered into an illegal transaction with its second-largest shareholder in an effort to dilute his stake in the company from 39% to 33.5%.
In a regulatory filing, Lionsgate criticized Icahn’s offer’s preconditions and heralded recent strong box office results from The Expendables and The Last Exorcism as indications the Santa Monica, Calif.-based company’s underperforming theatrical division had turned the corner.
An online report said Lionsgate also has high hopes for a budding film franchise "The Hunger Games," based on the first of three novels from author Suzanne Collins.
Previous efforts by Icahn to acquire shares have been characterized as financially insufficient by Lionsgate’s board and ultimately rebuffed by shareholders. Indeed, David Miller, analyst with Caris & Co. in Los Angeles, has long stated that Lionsgate is worth about $9 per share.