Lions Gate loses latest round in Icahn battle
The British Columbia appeals court has dismissed Lions Gate Entertainment's attempt to reinstate a "poison pill" that would have prevented activist investor Carl Icahn from acquiring the Santa Monica film and television studio.
The ruling is a blow to the company, which has been fighting Icahn's hostile-takeover attempt for the last two months. The proposed poison pill, which has yet to be approved by shareholders, would have prevented Icahn from raising his stake to more than 20%.
The British Columbia Securities Commission annulled the poison pill two weeks ago. Lions Gate appealed that decision and lost its case Friday, a studio spokesman confirmed.
Though it's headquartered in Santa Monica, Lions Gate is legally domiciled in Vancouver, giving authorities there jurisdiction.
Lions Gate could now petition the securities commission to reconsider its decision to throw out the poison pill. The company still plans to hold a shareholder vote on the pill this Wednesday.
For the moment, however, the dismissal of Lions Gate's appeal could be a boost to Icahn: His tender offer of $7 a share, which values the company at $825 million, expires Monday. Investor uncertainty over whether the poison pill will be enacted may have prevented some from selling their shares.
Icahn's offer was originally set to expire on April 30, but at that time, less than 6% of shares had been tendered to him. He then decided to extend his offer until May 10.Lions Gate shares fell 2.4% to $6.56 in Friday trading.
-- Ben Fritz