Struggling independent film company Cinergi Pictures Entertainment Inc. said Thursday it has agreed to a management buyout offer of $2.30 per share, or about $31 million.
Under the deal, Cinergi would be merged with CPEI Acquisition Inc., a company formed for the buyout by Andrew Vajna, Cinergi's president and chief executive, and Valdina Corp.
In August, Cinergi reported a second-quarter loss of $7 million on revenue of $17 million. In April, it agreed to sell the bulk of its movie library, including "Evita" and "Nixon," to Walt Disney Co. in exchange for cancellation of $38 million in production advances.
The buyout depends on successful completion of the Disney deal, which is set to close by Nov. 22.
Cinergi's stock rose 22 cents to close at $2.03 per share on Nasdaq.
While the offer is above the market price, it is well below the $8 to $9 per share that some investors paid in public offerings by Cinergi in 1994 and '95, according to the trade paper Daily Variety.
The buyers said they will increase their offer if the company earns more than $1.5 million from the "Evita" soundtrack, collects more than $1.57 million it is owed in relation to "An Alan Smithee Film," or if it realizes any profit from its first-look rights to several Oliver Stone development projects.
At the time of the announcement, the company had 13.4 million shares of outstanding stock, including nearly 5.5 million held by Vajna and nearly 1 million held by Valdina.