Carl Icahn on Thursday increased his hostile takeover bid for Lions Gate Entertainment Corp. by a buck to $7 per share in cash.
In a letter to the Lions Gate shareholders, Icahn said he also plans to replace the board of the Santa Monica film and TV studio with his own directors. Icahn said his offer will expire May 14.
“We decided to raise our offer price not because we believed $6 per share to be inadequate but rather because we felt it necessary to make every effort to protect the investment we currently have in Lions Gate,” Icahn said. “We do not feel comfortable that existing management is the right team to guide Lions Gate through this difficult period.”
Lions Gate, whose corporate headquarters are in Vancouver, British Columbia, said late Thursday that its board will review Icahn's revised offer and make a prompt recommendation to shareholders. Earlier this week, the company sent a letter to shareholders asking them to reject Icahn's $6-a-share offer as too low.
The independent studio also urged shareholders to approve the board’s new shareholder rights plan during a special meeting May 4. The so-called “poison pill” would block Icahn's attempt to increase his stake from 19 percent to nearly 30 percent.
Shares earlier closed down 3 cents, or less than 1 percent, to $6.37 on the New York Stock Exchange.
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