Investors owning more than 83% of New Frontier’s stock accepted Larry Flynt’s $33M offer — $2.02 a share, plus a 4 cent a share cash payment right — which expired at midnight. That means the Hustler publisher’s Flynt Broadcast has the votes needed to buy the publicly traded company “without the affirmative vote of any other New Frontier shareholder,” the company says. Still, Flynt will buy additional shares directly from New Frontier, at the same price he offered others, to reach 90% — the threshold that would enable him to complete the deal under Colorado law as a “short-form” merger. New Frontier shares are up 1.5% today to $2.05, a 95% increase over the last 12 months — but down nearly 60% over the last five years as the company struggled to compete with the proliferation of online porn. New Frontier produces VOD features, and offers the Penthouse TV premium channel and pay-per-view services packaged as The Erotic Networks (or TEN) that include Xtsy, Juicy, and VaVoom.
New Frontier shares are up about 35% in after-hours trading following an announcement that seems to mark an end to the battle over pay TV’s top supplier of porn movies and channels. Hustler magazine creator Larry Flynt‘s LFP Broadcasting signed a definitive agreement that values New Frontier at $33M, or $2.02 a share — a 55% premium over today’s closing price. The deal is expected to close by year end. New Frontier says that the board unanimously endorsed the agreement. It ”creates a great opportunity for our organization, cable television partners and customers as two of the premier adult media broadcasting companies join forces,” New Frontier says. Flynt wants to move fast: Within 10 business days, LFP Broadcasting will begin the process by offering shareholders $2.02 per share, without interest — and under certain circumstances he may add as much as 6 cents per share. His offer expires on the 20th business day. In accepting Flynt’s offer, New Frontier rejected a bid from investment firm Longkloof, which owns 15.9% of the company. Last month the company fired CEO and co-founder Michael Weiner, considered by the board to be too closely allied with Longkloof. It also received an offer from Luxembourg-based Manwin, which bought Playboy TV late last year.
The pay TV porn provider and former board member David Nicholas are accusing each of other of trying to secretly rig a potential sale of the company to investment firm Longkloof, according to letters made public today in an SEC filing. Their differences culminated in Nicholas’s September 29 resignation after 10 years on the board — which followed the company’s September 18 firing of company co-founder and CEO Michael Weiner. Nicholas says in his resignation letter that directors on a Special Committee exploring the Longkloof offer “may have breached their fiduciary duties” to shareholders by trying to derail the bid. But New Frontier’s directors sent a letter to Nicholas today that attacked his “baseless and misleading statements” adding that he secretly wanted to sell, and was asked to resign because his “conduct as a member of the Board has been unacceptable.”
The corporate struggle at this little-known company, which is key to the pay TV business, just became a little more interesting. New Frontier announced last night that Michael Weiner “has been terminated” as CEO. It gave no explanation for the decision to oust Weiner, who co-founded New Frontier in 1995. While the board looks for a full-time replacement, the top job will be shared by CFO Grant Williams, Chief Legal Officer Marc Callipari, and Chief Technology Officer Scott Piper. A longtime director, Alan Isaacman, replaced Weiner as chairman. His firing comes as New Frontier’s board tries to chart a path for the company’s future, including a possible sale. The company has received bids from investment firm Longkloof as well as from Luxembourg-based Manwin, which bought Playboy TV late last year.
New Frontier has agreed to add a representative to its board from investment firm Longkloof — which owns 15.9% of the programmer’s shares — if it doesn’t sell itself by year end, the company says this afternoon. In …
The weird battle over the cable industry’s top supplier of porn channels and videos just became a little more interesting. New Frontier shares rocketed 11.8% to $1.70 today after its largest investor, Longkloof Limited, raised its purchase offer to $1.75 a share from $1.35 — valuing New Frontier at about $28.3M. The new offer tops a separate $1.50 a share offer from Luxemburg-based porn company Manwin Holding, which last year bought Playboy’s TV and digital businesses. In April, New Frontier hired Avondale Partners to help sort through strategic alternatives. Longkloof, which owns about 15% of New Frontier, has said that it will nominate a slate of potential directors but insists that it wants to buy the company, not take control in a proxy fight. New Frontier produces VOD features, it also offers the Penthouse TV premium channel and pay-per-view services packaged as The Erotic Networks (or TEN) that include Xtsy, Juicy, and VaVoom.
New Frontier shares are up 11.4% to $1.37 at mid-day after Luxembourg-based Manwin — which bought Playboy TV late last year — offered $1.50 a share, about $24.3M. That tops the hostile $1.30 a share bid …