Mogul launches another hostile takeover bid

Carl Icahn has gone back to the barricades with Lionsgate at the end of a 10-day truce with the minimajor and launched another hostile takeover bid.

Icahn, who owns 37.9% of Lionsgate, announced Tuesday morning a tender offer for outstanding shares at $6.50 a share — 7% less than his previous $7 a share offer. The new offer expires Aug. 25.

Icahn also reiterated his promise to launch a proxy fight for control of the Lionsgate board. In response, Lionsgate said its board of directors will review the takeover bid and also advised shareholders to take no action at this time.

Neither side commented on the end of the truce, which apparently didn’t yield any concrete results. The 10-period, which expired Monday night, had been enacted to explore mergers and acquisitions.

Icahn said Tuesday he would not extend the truce for now but also noted that he wouldn’t dismiss the notion in the future.

“While certain discussions regarding acquisition opportunities might continue in the future, the Icahn Group determined that there were no immediate opportunities that would merit extension of the 10-day standstill period,” he said in statement.

Sources close to the situation have said Lionsgate execs presented a proposal last week to MGM debtholders under which Lionsgate toppers Jon Feltheimer and Michael Burns would have run a combined MGM and Lionsgate.

News of Icahn’s offer kicked up the price of Lionsgate shares, which had declined by more than 15% since Icahn’s previous offer expired at the end of June. In morning trading, Lionsgate surged 45 cents to $6.48.

Icahn said Tuesday that his offer’s conditioned on Lionsgate avoiding any major transaction outside the normal course of business.

“It is extremely unlikely that the current management and board of directors of Lionsgate will allow shareholders of Lionsgate to make their own determination on the future path of the company, including decisions to make a major acquisition,” Icahn said in a statement Tuesday.

Lionsgate has noted in previous statements that the majority of its investors have turned down spurned Icahn’s previous attempts to take over the company. Earlier this month, it introduced a “poison pill” or shareholder rights program to prevent a hostile takeover if any single shareholder acquires more than 38%.

The pill makes a hostile bid difficult because it allows other shareholders to buy additional shares at a discount.

Liosngate has not set its next shareholders meeting but that event usually takes place in mid-September during the Toronto Film Festival.

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