UPDATE, 2:00 PM: InterMedia Outdoor Holdings finally responded to Outdoor Channel’s decision this morning to scrap their merger plan. The company says it still believes that its cash and stock offer “is the superior choice for all Outdoor Channel shareholders” since it would give them a stake in “the significant combined future upside this combination provided.” But InterMedia won’t engage in a bidding war because “our first duty is to our investors and there are prices at which some deals stop making sense.” The owner of The Sportsman Channel and several guns and hunting oriented publications says it will continue to serve the “vibrant, passionate and growing audience who every day live the ‘sportsman’ lifestyle and who crave content across numerous outlets.”
PREVIOUS, 7:08 AM: The directors of Outdoor Channel know enough about math to see that $227M is more than $208M. So it’s no shock to learn this morning that they took the higher cash bid offered by Kroenke Sports & Entertainment, foregoing the lower cash and stock deal it made in in November with InterMedia Outdoor Holdings. The Kroenke offer provides “superior value for our stockholders,” Outdoor CEO Tom Hornish says. The decision rejects InterMedia’s claim that investors would be better off holding some stock; InterMedia also owns The Sportsman Channel and 15 magazines including Guns & Ammo and Petersen’s Hunting. Outdoor paid a $6.5M termination fee to InterMedia and cancelled the special shareholders’ meeting to vote on that deal, which was scheduled for March 22 after a postponement from March 13. Shareholders and regulators still must approve the Kroenke agreement, which Outdoor expects to close by mid-year. Kroenke’s victory apparently was sealed when Outdoor’s largest stockholders who collectively control 41% of the votes agreed to support the bid. Outdoor says, though, that their support is “subject to certain exceptions.”
Kroenke Sports is controlled by Stan Kroenke, who owns the NFL’s St. Louis Rams, the NBA’s Denver Nuggets, and the NHL’s Colorado Avalanche. Outdoor’s advisory team included Lazard and law firm Wilson Sonsini Goodrich & Rosati. Kroenke had Allen & Company and Wachtell, Lipton, Rosen & Katz.