(Updated: 1:40 p.m. PST)
Carl Icahn has struck out in his bid to place loyalists on Lionsgate's board of directors. Shareholders rejected the billionaire investor's five nominees at the company's annual meeting on Tuesday.
The studio's entire slate of 12 board candidates was confirmed, a spokesperson for Lionsgate confirmed.
Read also: Icahn's Lionsgate Bid: Out of Time — and Luck
Icahn has been engaged in a hostile takeover bid for the Vancouver-based studio for much of the past year. He had hoped to not only install his own group of allies on the studio's board, but also to dethrone Vice Chairman Michael Burns.
Lionsgate released the following statement after its entire slate of nominees had been elected.
"We appreciate the strong support we have received from our shareholders throughout this process. Today’s outcome reaffirms that Lionsgate shareholders continue to have confidence in the Board’s and management team’s strategy to enhance value for all Lionsgate shareholders."
Though decisive, his defeat had been expected. On the heels of a New York court decision that denied his move to strip voting shares from a rival stakeholder, Icahn admitted that he wouldn’t have enough support to install his slate of rebel nominees on Lionsgate’s board. Following the vote, Icahn continued to maintain that had his injunction been granted, his slate would have prevailed.
"This whole situation is a very sad commentary on the state of corporate governance today. The biggest losers are the shareholders of Lions Gate who were deprived, as a result of the machinations of Lions Gate’s board and senior management, of the opportunity to receive a large premium for their shares in our tender offer," Icahn said in a statement.
Icahn had hoped the court would overturn a controversial debt for equity swap that reduced his stake in Lionsgate from 38 to 33 percent and strengthened the ownership position of rival Mark Rachesky. In light of that legal setback, Icahn dropped his latest $7.50 a share tender offer.
Icahn's rebel slate included former Overture chief Chris McGurk, former film executive Jay Firestone, former music executive Michael Dornemann, lawyer Daniel Ninivaggi and former Princeton president Harold Shapiro.
The billionaire may have found himself between a rock and a hard place, but he still has options. He could, of course, liquidate his holdings, but with the stock in limbo, he'd stand to take a bath.
More likely, many analysts speculate, is that Icahn either raises his tender offer substantially or plays kingmaker in a possible merger with Metro-Goldwyn-Mayer, where he owns a substantial portion of that studio's debt.
But in Icahn's months-long bid to take over Lionsgate's board, it's checkmate time.
