TORONTO – Score Media offered itself up for sale Wednesday after a clause in its agreement with Alliance Atlantis was triggered by the large company’s impending acquisition by CanWest Global.
Levfam Holdings, the holding company for Hamilton’s Levy family, "delivered a notice to Alliance Atlantis Communications… offering to sell all of the Class A Subordinate Voting Shares and Special Voting Shares of Score Media held by Levfam and its affiliates and associates for a price of $2.90 per share." Levfam is headed by John Levy, Score Media’s CEO.
Such a share price would value Score Media, whose primary asset is analog sports news channel The Score, at $283.5 million
Score Media shares closed at $1.60 Wednesday and has been around the $1 range for years.
"Levfam’s notice was provided pursuant to a Respective Rights Agreement made November 24, 2000, to which Levfam, Alliance Atlantis and Score Media are parties," explains the press release. "The provisions of the Respective Rights Agreement provide that Alliance Atlantis will have a 30 day period in which to choose to accept the offer set forth in the notice, and in the event that Alliance Atlantis does not accept the offer, Levfam will have a period of 120 days during which it may enter into a binding agreement to sell its shares in Score Media to one or more third parties, provided that such sale is made for a price and on terms and conditions no more favourable than those offered to Alliance Atlantis in the notice."
Levfam and its affiliates and associates currently hold 36,743,552 class a subordinate voting shares, representing approximately 37.8% of the total number of Class A subordinate voting shares outstanding, and 5,566 special voting shares, representing 55.7% of the total number of special voting shares outstanding. If Alliance Atlantis pays the 55% premium on the share price as compared to today, Score Media will bring in over $106 million with the sale.
At the same time, the company also announced that it has entered into an agreement with Levfam relating to the sale by Score Media to Levfam of Score Media’s Hardcore Sports Radio business for a price of $1.5 million. "The sale is conditional upon the acquisition by Alliance Atlantis or other third parties of Levfam’s shares," says the press release.
The agreement may be ended if the sale by Levfam of its Score Media shares to Alliance Atlantis or a third party has not been completed by November 17, 2007, unless Levfam enters into such an agreement prior to that date, is diligently pursuing the sale transaction, and completes the sale by June 20, 2008, says the release.
The board of directors of Score Media, upon the recommendation of the special committee, has approved the proposed Hardcore Sports Radio transaction. Genuity Capital Markets provided the special committee with advice as to the appropriateness of the consideration to be received by Score Media.
