Netflix shares skyrocketed — +20% at one point in mid-afternoon trading before closing +13.8% — after the billionaire corporate raider disclosed that he recently bought stock and call options that could give him control of 9.98% of the company. Carl Icahn says in an SEC filing that Netflix is “undervalued” and “may hold significant strategic value for a variety of significantly larger companies that are engaging in more direct competition with one another due to the evolution of the internet, mobile, and traditional industry.” Icahn also is “considering ways for [Netflix] to maximize shareholder value.” But he has “reached no conclusion” and “may in the future seek to have discussions” with the company. That’s a loud cannon shot across CEO Reed Hastings‘ bow: Icahn made his name as a so-called corporate raider, buying stock in companies that he considered undervalued and then angling either to take control or change the firm’s strategy to boost the share price.
Lionsgate Vice Chairman Michael Burns had to disappoint analysts who wanted him to open up about the big question of the day for his company: What’s going on with its reported merger talks with Summit Entertainment? “I’m not going to talk about any specific deal,” he said at the UBS Annual Global Media and Communications Conference. He noted, though, that a consolidation of independent film and TV companies is “a natural thing to happen.” He assured the group that Lionsgate is only interested in deals that add to its value, and don’t require it to either issue stock or take on additional debt. “We’re looking to delever, not lever up,” he says.
With that out of the way, he spoke candidly about the company’s plans for next year where he says “you’ll see us steady state for the first time” cranking out about a dozen movies and about three new TV shows. He’s encouraged about a plan to develop a TV series for ABC based on The Lincoln Lawyer – and Charlie Sheen’s Anger Management. ”I’ve known Charlie a long, long time,” Burns said. “Our goal is to keep Charlie working, keep him healthy — and we have a great partner in FX.” Burns says that a series it’s developing for
So much for last week’s breathless reports about how this secondary offering for 19.2M of Carl Icahn’s shares was put “on hold” due to a drop in Lionsgate’s stock price. The deal with Icahn requires Lionsgate to pay him $7 a share, which should then put an end to the billionaire’s effort to control the film and TV company. Lionsgate didn’t want to have to make up the difference if it couldn’t collect that much from this offering. That doesn’t seem to be a problem now; Lionsgate closed yesterday at $7.10.
OK, so how did Icahn fare in this Hollywood drama? Not well. He probably ends up with a slight profit on his Lionsgate stock, which cost him an average of $6.90 a share. But that likely was more than eaten up by the legal bills for his applications to the Securities Commission in British Columbia, the suits he lost in the Canadian province’s Supreme Court and Appeals Court, as well as cases at the New York Supreme Court and District Court. Here’s the announcement of the offering:
Has Lionsgate’s effort to sell 19.2M shares in the company owned by Carl Icahn been put “on hold,” as Reuters reported yesterday? The answer is: sort of, but not exactly. Yes, the company wanted to price the shares this week …
Lionsgate said in a regulatory filing today that Mark Rachesky, the former Carl Icahn protege and the mini-major’s largest shareholder, has been appointed co-chairman of the board, a title he will share with current CEO Jon Feltheimer. The …
SANTA MONICA, CA, and VANCOUVER, BC, August 30, 2011 – Lionsgate (NYSE: LGF) (“the Company”), a leading diversified global entertainment company, announced today that Carl and Brett Icahn have reached an agreement with the Company under which the Icahns have agreed to sell up to 44,161,971 shares of Lionsgate common stock, representing substantially all of the Lionsgate shares currently owned by the Icahns. The parties also agreed to dismiss all outstanding litigation between them and release all claims that they may potentially have against each other.
BREAKING: In a move that ends a protracted hostile takeover attempt, Carl Icahn and Lionsgate have announced that Icahn and his son Brett will sell up to 44,161,971 shares of Lionsgate common stock, which is virtually the entire stake held by the family. Both Lionsgate and Icahn in turn have dropped the various litigation between them. Those shares will be sold for $7, which is below the $7.52 that the stock was worth at the market close today.
Through a series of tender offers that ranged from $6 per share to $7.50, Icahn accumulated a total of 33.2% control of Lionsgate, blasting the company’s management every step of the way as he tried to oust the company’s board. Those shares will fall into the hands of Lionsgate’s largest shareholders in a series of transactions that will take place over the next 35 business days. Right away, Lionsgate has bought 11,040,493 shares for $7 each. Another 11 million shares will be bought by one or more affiliates of MHR Fund Management LLC, which is controlled by Mark H. Rachesky, a Lionsgate director whose moves during the takeover battle helped management keep Icahn from accumulating enough shares to win a proxy battle.
This is the biggest deal Google has ever made. We’ll see whether it gives the Web giant the resources it needs to make its Android-powered handsets even more potent competitors to Apple’s iPhone. But Motorola Mobility investors should be happy with the $40 a share offer — a 63% premium from Friday’s closing price: Billionaire Carl Icahn, who owns 11.4% of the company and had urged it to consider cash-generating options such as selling its patent portfolio, says the deal is “a great outcome for all shareholders of Motorola Mobility, especially in light of today’s markets.”
MOUNTAIN VIEW, Calif. & LIBERTYVILLE, Ill.– Google Inc. (NASDAQ: GOOG) and Motorola Mobility Holdings, Inc. (NYSE: MMI) today announced that they have entered into a definitive agreement under which Google will acquire Motorola Mobility for $40.00 per share in cash, or a total of about $12.5 billion, a premium of 63% to the closing price of Motorola Mobility shares on Friday, August 12, 2011. The transaction was unanimously approved by the boards of directors of both companies.
The acquisition of Motorola Mobility, a dedicated Android partner, will enable Google to supercharge the Android ecosystem and will enhance competition in mobile computing. Motorola Mobility will remain a licensee of Android and Android will remain open. Google will run Motorola Mobility as a separate business.
Now that the Harry Potter series is done, it’s only natural that Wall Street would start to wonder: What’s the next movie franchise that will drive teens and adults to the box office in droves? And two analysts today think they have an answer. Lionsgate’s The Hunger Games, a four-movie series based on Suzanne Collins’ trilogy about two teens in a post-apocalyptic society struggling to survive a life-or-death contest. PiperJaffrey’s James Marsh raised his target price for Lionsgate shares to $12 from $10 based largely on his expectation that the films will “provide a material and identifiable catalyst” for the company. Cowen and Co’s Doug Creutz used similar language to project that Lionsgate shares will “outperform the market by at least 20% over the next 12 months.” That would be a welcome change for Lionsgate. Many investors soured on the company while billionaire Carl Icahn battled to take control and DVD sales began to collapse for the industry. Lionsgate’s shares have appreciated just 5% over the last 12 months while the overall market was up 20%. But the analysts say investors will turn the page as they begin to feast on news about Hunger Games. Marketing will begin late this year for the March 2012 release. Marsh says he expects it to become “the highest grossing film of all time at Lionsgate” with $150M in domestic box office sales.
Billionaire Carl Icahn suffered another setback today in his hostile takeover attempt of Lionsgate. The Court of Appeal for British Columbia upheld a lower court ruling that Lionsgate had acted appropriately last year when it allowed a lender to swap his debt …