The billionaire shareholder activist isn’t buying a lot — but it’s enough to keep company watchers wondering whether he might challenge Lionsgate’s management at the September 13th investor meeting in Toronto. He bought 53,963 shares this week at about $7 a share, raising his stake slightly to 33.2%, he says in an SEC filing. The latest purchases follow the 702,877 shares he bought last week, his first purchase of the studio’s stock since July 2010. It’s unclear whether he’ll be able to cast votes with his new holdings. Lionsgate set August 5th as the record date — purchases after then typically can’t be voted. But Canadian law allows for some exceptions. Still, Icahn could offer other candidates for the board at any point up to the meeting. Icahn, who has criticized Lionsgate’s spending and strategy, nominated five board candidates last year. All lost. Lionsgate said last week that it is running the same 12-director slate that was elected last year.
Another nasty day in the Carl Icahn vs Lionsgate battle. This time, Icahn has made good on his threat to go to court to overturn the film/TV studio’s recent “scorched earth tactic” that diluted his stock holdings He’s referring to last week’s debt-for-equity swap involving major shareholders Mark Rachesky and John Kornitzer. The lawsuit was filed today in the New York State Supreme Court against Lionsgate, its board of directors, Rachesky, Kornitzer Capital Management and its principal John Kornitzer. Icahn wants an injunction to reverse the deal that bought and converted $100 million in senior notes to reduce Icahn’s stake in Lionsgate from 37.3% to 33.5%. “If allowed to stand, this scheme will insulate the directors and management from having to face a fair election at the upcoming annual meeting of Lionsgate’s shareholders,” Icahn said.
He also filed a Canadian petition in the Supreme Court of British Columbia about the manuever on Friday, while the British Columbia Securities Commission has scheduled a hearing about it on July 28th.
It was Lionsgate’s lastest attempt to thwart his hostile takeover of the mini-major and give it to his son Brett to run. Still pending is Icahn’s latest $6.50 a share tender offer for outstanding shares of the company, and his promise to wage a proxy fight over control of Lionsgate’s board at the September annual meeting.