Studio says bid not in shareholders' best interests
The minimajor’s disclosure came after the stock market closed Monday. Lionsgate stock was up 12¢ to $6.72 a share — 3.4% above Icahn’s $6.50 a share bid, which expires Aug. 25.
Lionsgate said Icahn’s offer “is not in the best interests of Lionsgate and its shareholders and other stakeholders.”
Icahn lost a round last week in his bitter battle with Lionsgate as Canadian regulators spurned his efforts to overturn the recent $100 million debt-to-equity swap that cut the billionaire’s stake to 33.5% from 37.3%. A British Columbia Securities Commission panel made the ruling Wednesday.
Icahn also filed suit last week in New York against Lionsgate, its board and board member Mark Rachesky — who bought the converted shares from the company and saw his stake grow to 29% from 19.9% — along with Kornitzer Capital Management and John Kornitzer, who sold the $100 million in debt to Rachesky that was converted to stock.
Icahn launched the latest hostile takeover bid July 20, the same day the minimajor made the deal with Rachesky.
Icahn has owned shares since 2006, and has blasted management for its strategy and spending — accusations that Lionsgate toppers have attacked as unfounded.
Lionsgate reiterated Monday its criticisms of Icahn’s offer as “financially inadequate,” “coercive” and “opportunistic.”
It also noted that Icahn’s first offer was completed at $7 a share, which was also rejected as inadequate, and pointed out that since then, the company has generated record performance in its fiscal year ended March 31 in terms of revenues and adjusted earnings, along with “significant improvements” in net loss and cash flow.