Is Reading International, the USA’s No. 11 movie exhibitor, on the block? Not yet, it seems. But the company’s stock price is up 8.3% this week after a disclosure that it rejected an unsolicited offer of about $370 million last month.
The board “carefully evaluated the indication of interest” from an unnamed suitor, Reading says. Directors concluded, though, that “our stockholders would be better served by pursuing our independent, stand-alone strategic business plan.”
The offer of $17 a share contrasts with the current trading price of about $13.60.
Reading doesn’t usually disclose offers that it rejects. But its hand was forced last week when board member James Cotter mentioned it in a public filing he made in a suit in Nevada.
It’s been a messy affair. He’s suing the company, challenging his firing last year as CEO. Then funds managed by Whitney Tilson and Jonathan Glaser joined in, charging that the Cotter family, which controls Reading, had allowed family squabbles to affect company governance, engaged in self-dealing and tolerated excessive executive pay.
The shareholder suit was withdrawn last week subject to a settlement agreement.
Reading has 57 theaters with 461 screens in the U.S. Australia and New Zealand. Its 26 theaters and 237 domestic screens include Reading Cinemas, Angelika Film Center, Consolidated Theaters, City Cinemas, Beekman Theatre, The Paris Theatre, Liberty Theatres, and Village East Cinema.