Icahn Makes Offer to MGM Debt-Owners

NEW YORK: In an effort to facilitate a merger between Lionsgate and MGM, Carl Icahn has made an offer to buy MGM debt in order to secure votes against the proposed combination with Spyglass Entertainment.

The offer, Icahn says, "will give participating holders of Senior Loans the right to keep the upside on their MGM position, if there is one, without taking risk on the downside."

Icahn is offering a purchase price of $0.45 per $1.00 in principal amount, conditioned upon a minimum of $963 million in principal amount in senior loans participating in the offer. The offer will expire at the voting deadline for the MGM/Spyglass proposal on October 29. Participating lenders will be required to vote against the Spyglass plan and grant a proxy to Icahn.

Icahn says he is "firmly opposed" to the MGM/Spyglass proposal, referring to it as a "prescription for disaster."

Icahn noted, "The plan is being backed by certain members of the MGM creditors committee, and is being ramrodded through with the typical fear tactic that the ‘sky will fall’ if the plan is not approved…. It is more likely for the sky to fall if the Spyglass Plan was approved."

He continued, "This is the critical decision point for MGM lenders, yet we are being rushed into an extraordinary Prepackaged Plan with limited information and input, on a ‘hurry up basis’ that frustrates any dissent. I hope to defeat this ‘rush to judgment’."

Icahn is urging all senior MGM lenders to vote against the Spyglass plan, even if they are not taking up his offer. "A ‘No’ vote will force an open and transparent process to allow all lenders the full and fair opportunity to evaluate all information and obtain complete, unbiased analysis regarding all offers and opportunities that may be available for MGM. It is interesting to note that Lionsgate has made an offer but their request to put it out publicly has been refused. It has also come to my attention that at least one other offer has been made which has not been made public by MGM or the MGM creditors committee. It is my intention to bring all of these offers to light. We should not allow ourselves to be railroaded into the Spyglass plan."