News Release

Vancouver - A British Columbia Securities Commission panel has released summary reasons for cease trading a shareholder rights plan adopted by Lions Gate Entertainment to stop a take-over bid by the Icahn Group. 

On April 27, the commission panel granted an application by the Icahn Group to cease trade securities related to the Lions Gate shareholder rights plan (SRP).

The panel applied Canadian securities laws governing take-over bids and defensive tactics. In its reasons for cease-trading the Lions Gate SRP, the panel noted that take-over bids should leave shareholders of a target company free to make their own decisions whether to accept or reject the bid.  

The panel noted that, while Canadian securities regulators are reluctant to interfere with a board’s attempt to use an SRP to protect a company’s interests, past cases have involved target company boards that were actively negotiating or soliciting competing bids or alternative transactions.

Lions Gate did not seek, and doesn’t plan to seek, competing bids for shareholders to consider.

In the panel’s opinion:

• The Lions Gate SRP would result in its shareholders being deprived of the ability to respond to the Icahn bid
• The Lions Gate SRP had exhausted its usefulness and there was no justification for its continuation
• There was no evidence at the hearing on April 27 that the Icahn bid would be extended past its then expiry date of April 30

The panel will elaborate on the summary reasons in its final reasons.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You can view the decision on our website www.bcsc.bc.ca by typing Icahn Group or 2010 BCSECCOM 233  into the search box. If you have questions, contact Brenda-Lea Brown at 604-899-6554.

Learn how to avoid investment fraud at the BCSC's investor education website: www.investright.org