The ongoing battle for control of discount ticket seller Tix Corp. has taken yet another turn.
Less than a month after attempting to buy all outstanding shares of the Studio City company, Chief Executive and Chairman Mitch Francis has withdrawn his offer over concerns about the terms of the acquisition and financing availability.
News of Francis’ decision sent the company’s thinly traded shares plunging 19 percent last week, the biggest drop on the LABJ Stock Index. Shares closed July 3 at $1.62. (See page 24.)
After more than a year of rumors of an impending management-led buyout, Francis offered last month to buy all outstanding shares for $2.25 apiece, a 32 percent premium over the share price at the time. Francis owns 3.7 million shares, or about 16 percent of the company, according to regulatory filings.
The board appointed two directors to a special committee to analyze the proposal and alternatives, but the company noted that Francis’ offer was contingent on several conditions, including his ability to obtain financing on favorable terms and the negotiation of an acceptable merger agreement.
“These issues were ultimately not able to be agreed upon, which did not permit the transaction to proceed,” Tix said in a June 29 statement.
Neither Francis nor Chief Financial Officer Steve Handy returned calls requesting comment.
In April of last year, Brentwood investment firm Baker Street Capital Management LLC, then the largest shareholder, launched an acquisition attempt to prevent management from buying Tix and taking it private. Vadim Perelman, Baker Street’s managing partner, offered $2.10 a share at the time, calling Tix “substantially undervalued.”
Perelman did not return calls requesting comment.
Baker Street remains the largest independent shareholder, but its stake has been reduced from 22 percent to 11 percent.
The Tix board subsequently adopted a shareholder rights plan, or poison pill, to prevent Baker Street’s takeover and denied that management was preparing to acquire the company.
Founded in 1993 as Cinema Ride Inc., Tix has for the past decade specialized in selling discount tickets for Las Vegas shows. The company struggled during the downturn and has had a choppy recovery. It was modestly profitable last year but was in the red each of the past two quarters. The company reported a $294,000 loss in the first quarter.
For reprint and licensing requests for this article, CLICK HERE.
Stories You May Also Be Interested In
- Investor Sees Opening to Take Over Ticket Seller
- Discount Seller’s Seats Up in the Air
- Tix Board Rejects Shareholder's Acquisition Offer
- Tourism in Las Vegas Has Ticket Dealer Sitting Pretty
- Tix Shares Rise on Announcement of Repurchase Program
- Tix Makes Acquisition
- Rolling in Las Vegas
- Rolling in Las Vegas