Lionsgate has sued its biggest shareholder Carl Icahn, claiming he publicly opposed a merger between the company and MGM then gummed up the process until he could profit substantially from a potential marriage. Lionsgate claims Icahn publicly said he would oppose the merger, only to turn around and secretly buy up a large stake in MGM’s debt…and then push for the merger. ”It turns out that Icahn was misleading Lionsgate and its shareholders all along,” the lawsuit, filed in New York, says. And that “recent developments indicate he was playing a double game. Icahn opposed a merger not because it was bad for Lionsgate but because it was good – so good in fact that he wanted to postpone it until he could buy up as much of both companies as he could.” The suit also says that, “While urging Lionsgate shareholders to support his takeover campaign to ensure that Lionsgate did not pursue what he called a ‘delusional’ MGM transaction, Icahn was quietly amassing a huge position in MGM debt with the undisclosed intention of reaping profits from both sides in an eventual merger.” All of this comes one day before the voting deadline on a proposed prepackaged bankruptcy plan that would see Spyglass Entertainment’s Gary Barber and Roger Birnbaum take over the studio. Just this week, Icahn redoubled his efforts to buy up even more MGM debt in preparation for a Lionsgate merger, so the big unknown is how any of this drama will affect that proposed alliance. The suit also demands a halt to Icahn’s purchase of Lionsgate stock until the SEC has all appropriate information and disclosure. It also seeks damages for “tortious interference.”
By THE DEADLINE TEAM | Thursday October 28, 2010 @ 3:44pm PDTTags: Carl Icahn Lionsgate, Carl Icahn Lionsgate Lawsuit, Carl Icahn Lionsgate MGM Merger, Carl Icahn Shares, Lionsgate, Lionsgate MGM Merger, Lionsgate Shareholders, Lionsgate Shares, MGM Debt, MGM Spyglass, Movies
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This article was printed from http://www.deadline.com/2010/10/lionsgate-sues-carl-icahn-says-he-was-playing-a-double-game/