Lionsgate has a message for its shareholders -- endorse Carl Icahn at your own peril.
The billionaire investor and Lionsgate's largest stakeholder made his umpteenth play for control of the Vancouver based studio last week when he unveiled the team of loyalists and industry veterans he'd like to see take the company's reins.
In a note to shareholders, Lionsgate's board once again called on its shareholders to reject Icahn's rebel slate of board members. The studio reiterated its call for investors to confirm its own nominees at the company's annual meeting on Dec. 14.
The Lionsgate board also urged stakeholders to discard any proxy materials they receive from the Icahn Group.
It's nothing that the studio's brass hasn't said before, but this time it arrived in a letter that argued that a vote for Icahn's group endangered shareholders' investments. In a letter co-signed by CEO Jon Feltheimer and Vice Chairman Michael Burns, Lionsgate pointed to its recent string of box office successes and its expansion of its television slates as reasons to stay the course.
Icahn has been engaged in a proxy fight for control of the studio for much of the past year. The board candidates he submitted on Friday were former Overture chief Chris McGurk, former film executive Jay Firestone, former music executive Michael Dornemann, lawyer Daniel A. Ninivaggi and Harold T. Shapiro, the former president of Princeton.
Here's the full text of the note Lionsgate sent to shareholders:
November 29, 2010
Dear Fellow Lionsgate Shareholder:
As Lionsgate’s 2010 Annual General Meeting of Shareholders approaches, your Board of Directors urges you to vote the WHITE proxy card to elect the Company’s highly qualified and experienced nominees. Your Board and management team strongly believe that Lionsgate’s results over the past year underscore the success of its strategy to deliver value to shareholders by achieving strong and consistent growth from Lionsgate’s diversified portfolio of businesses.
On the other hand, the Icahn Group has not articulated a vision, much less a strategy, for Lionsgate regarding how it would improve on these results and its nominees provide no further clarity on the critical issue of leading Lionsgate into the future. Instead, the Icahn Group’s self-serving agenda stands to take away from the value of your investment.
Your Board and management team are confident that its strategy has Lionsgate on track to continue to build its momentum and to deliver value to shareholders. Now is certainly not the time to make a change.
To protect and to realize the value of your Lionsgate investment, your Board urges you to please vote FOR the Lionsgate director nominees on the WHITE proxy card.
THE LIONSGATE BOARD IS COMMITTED TO DELIVERING VALUE
TO ALL LIONSGATE SHAREHOLDERS
Over the past ten years, the current Board and management team have developed and executed on a disciplined plan to create a diversified media business that is creating long term value for Lionsgate shareholders. As a result of this plan, Lionsgate today has a world-class media platform that leverages content creation, production and distribution across diverse channels.
