New York
– Activist investor Carl Icahn on Wednesday called out the head of Lionsgate (NYSE:  LGF),
the film studio for which he has made an unsolicited takeover bid, detailing
how he believes the company has been mismanaged in recent years. Icahn
questioned Lionsgate head Jon Feltheimer’s assertion that the company has
steadily built shareholder value over the past ten years, noting that most
appreciation came with its acquisition of Artisan in 2004, while the share
price has remained stagnant or fallen since then.

"If the stock price of a
company remains stagnant for years, as it has with Lions Gate, then clearly
something is wrong. I suggest that your directors have failed
shareholders," Icahn said in his open letter to Feltheimer.

Icahn further
attacked Lionsgate’s hopes to acquire the film libraries of MGM and Miramax.

am fearful that you have determined to ‘swing for the fences’ using excessive
debt and risking the shareholders’ equity," Icahn wrote.

"The road to
bankruptcy is littered with companies whose CEOs — under the banner of
‘vision’ — have been permitted by lax board oversight to gamble their
companies into oblivion."

Lionsgate responded by saying that Icahn’s
letter is "simply attempting to distract shareholders from the obvious —
his offer price is woefully inadequate."

The studio also alleges that in
discussions with management last year, Icahn mentioned potentially providing
financing for the company’s proposed acquisition of MGM, and is now
"openly criticizing Lionsgate for its interest in acquiring

It also said Icahn was openly critical of its
acquisition of TV Guide Network and last year, but has since
praised management for the decision.

The company concluded by saying that it is
"confident we can better serve our shareholders by continuing to execute
our strategic business plan."


Related Links:

(Icahn letter)
(Lionsgate statement)
(DMW previous coverage)
(DMW previous coverage)