Davis May Hike Lorimar Bid but Wants to See the Books
Investor Marvin Davis, snubbed in his $770-million takeover bid for Lorimar Telepictures, on Wednesday sent a letter to the company saying he is prepared to raise his $17-a-share offer if a review of Lorimar’s books supports an increase.
Noting that “the price of the stock has doubled on takeover rumors and well over 50% of the outstanding shares now are held by (stock speculators),” Davis said: “I believe you have passed the point of no return. . . . It is time to quickly and efficiently provide equal access (to non-public information) to all serious bidders.”
Lorimar disclosed March 7 that it was conducting merger talks with Warner Communications, which has been given access to the Culver City entertainment company’s books.
In the letter, addressed to Lorimar Chairman Merv Adelson, Davis added: “It is upsetting to me, as it must be to all shareholders, that only one of the parties interested in acquiring (Lorimar) has had the opportunity to inspect its books and records.”
Davis also charged that “key creative ideas, strategies and relationships are being divulged which will significantly damage (Lorimar’s) position in the industry” and that productivity and morale at the company is “plummeting.”
In addition, Davis indicated that he owned a “substantial block” of Lorimar stock. A spokesman said it was less than the 5% that an investor must disclose publicly, and most if not all of the stock was acquired before Davis made his takeover proposal on March 10.
The company’s stock closed unchanged at $15 a share Wednesday in heavy trading on the American Stock Exchange.
Lorimar spokeswoman Sue Binford said Wednesday that the company had no comment on Davis’ letter and declined to comment on the status of talks with Warner.
