Emmis Communications and JS Acquisition, the company via which founder and CEO Jeff Smulyan is trying to take the company private, now say it is “unlikely” that a deal will be reached, but they’re not giving up yet, so talks are continuing. The shareholders meeting to vote on measures to clear the way for the going private buyout convened for an 8th time Friday morning (9/3) and adjourned until 6:30 pm ET next Wednesday (9/8).
Along with rescheduling the shareholders meeting, JS Acquisition has extended its tender offer to buy any and all class A shares for $2.40 each until 5:00 pm ET Wednesday and Emmis has extended its tender to exchange new high-yield bonds for its preferred shares at 60% of face value to the same deadline.
“The offers are being further extended because Emmis, JS Parent, JS Acquisition and Mr. Smulyan are continuing their discussions in an effort to reach an agreement with Alden Global Capital, a private asset management company that had previously agreed to provide financing for the tender offer through an affiliate, and a group of holders of approximately 38.3% of the outstanding shares of Preferred Stock in the aggregate who have previously indicated that they would vote against the matters to be voted on at the special meeting. Although we believe that an agreement among the various parties remains unlikely, we believe the extension is warranted due to the continuing discussions,” Emmis and JS Acquisition said Friday in their paired news releases.
The tally of Class A shares tendered and not withdrawn by the latest deadline of 5:00 pm Thursday, September 2, had fallen below 20 million to 19,824,537. If his buyout succeeds, which now seems unlikely, Smulyan would add 29,722,866 shares to the ones he already owns for a total of 32,910,753.
The number of preferred shares tendered and not withdrawn by 5:00 pm Thursday actually increased from the previous tally by 400 to 422,803. That is only a small portion of the 2.8 million shares outstanding.
The pending buyout, including debt assumption, values Emmis at about $670 million.
RBR-TVBR observation: Nine surely sets a Wall Street record for the most times a single shareholders meeting will have convened. This has become almost comical, except that real money is in play and real people are trying to figure out what is happening to their employer. Smulyan seems determined to hang onto any remaining chance to make the buyout happen, since he failed in a previous attempt in 2006 to buy out other shareholders for $15.25 per share.