The ongoing battle between corporate raider Carl Icahn and Lionsgate has yielded yet another update.
The movie studio issued a releasesaying that its shareholders rejected Icahn's offer to buy the company's common shares for $7 per share.
Icahn said some 7.4 million shares have been tendered — Lionsgate says that amounts to less than 6.5 percent of outstanding shares. Icahn's offer is contingent on his acquiring 31 percent of the company's shares, to give Icahn Group more than 50% of the company.
Icahn's response to this number of tender offers is to extend the deadline for his big to May 21, 2010 -- delaying his offer for the second time. Lionsgate's response: declaring that shareholders are rejecting Icahn's offer, and recommending that they not tender their shares, and that they vote for the Shareholder rights plan at the company's May 12 meeting. Shareholders may submit their proxies until the end of the shareholder meeting, which will be held on Wednesday in Toronto.
Icahn could re-cast his offer, requiring a lower percentage ownership or by offering a higher share price. But for Icahn to secure the seats on Lionsgate's board he's been pushing for, he'll need a significant share of the company's stock. We'll see what happens at the shareholder meeting on Wednesday, and we'll see if Lionsgate can make any progress on the British Columbia court of appeals ruling on the company's "poison pill" plan. Today's announcements seem a win for Lionsgate, but Icahn's making it clear that the battle isn't over yet.
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