Cablevision (NYSE: CVC) is downplaying a shareholder lawsuit filed against it in a Delaware federal court, which is looking to stop the $17.7 million takeover of the company by European telecom magnet Altice NV.
Shareholder James R. Gould, Jr. says that even though the deal, valued at $34.90 a share, values Cablevision at a 22 percent premium, it sells the MSO shorts on the synergistic benefits it provides Altice as it seeks to establish a presence in the U.S. cable business.
In response, Cablevision emailed FierceCable this statement: "This lawsuit is completely without merit and we plan to contest it vigorously."
On Sept. 17, the day the deal was announced, San Diego's Robbins Arroyo LLP announced that it would be among a number of law firms "investigating" the deal for potential holes.
"As an initial matter, the $34.90 merger consideration represents a premium of only 22.3 percent based on Cablevision's closing price on September 16, 2015," a Robbins Arroyo statement said. "This premium is significantly below the average one-day premium of nearly 28.2 percent for comparable transactions within the past three years."
For their part, a number of media analysts would stridently disagree that $34.90 a share was too little to pay for Cablevision. In April, the company's stock was trading at less than $19 per share before rumors that Altice might buy the company sent its stock price on a steep incline. Its shares opened at $33.04 today.
- read this Law360 story (sub. req.)
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