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CKX Inc. Stockholders File Lawsuits In Effort To Stop The Buyout By Apollo Global Management

  • If you purchased shares of CKX Inc. (NASDAQ:CKXE) and currently continue to hold those NASDAQ CKXE shares, you have certain options and you should contact the Shareholders Foundation, Inc.

  • To have your information reviewed for options and to receive notifications about this case, please send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.

Lawsuit Overview

Company
CKX Inc.
Security
NASDAQ: CKXE

Case Name
CKX Deal Case 05/25/2011
Type of Lawsuit
Mergers and Acquisition
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Summary

At least three investors in CKX Inc. (NASDAQ: CKXE) shares filed lawsuits against the directors of CKx, Inc. in effort to block the proposed takeover of Ckx by Apollo Global Management.
According to the complaints the plaintiff allege that defendants breached their fiduciary duties in connection the proposed buyout. On May 10, 2011, before the market CKx, Inc. (NASDAQ: CKXE) had announced that it has entered into a merger agreement to be acquired by an affiliate of Apollo Global Management. Under the terms of the proposed transaction, CKx, Inc stockholders will receive $5.50 in cash for each CKXE share that they hold. CKx, Inc said the offer represents an approximately 40% premium over CKx's average closing price over the past six months and an approximately 25% premium over the closing price on Monday, May 9, 2011.

Indeed, following the takeover announcement shares of CKX Inc. (NASDAQ:CKXE) jumped from $4.45 on May 9th to $5.46 on May 10th.

However, the plaintiffs alleges the offer undervalues Ckx. In fact recent trading prices for CKXE shares have been close under and above the current offer, leaving CKX investors with practically no premium, but asking them to hand over their shares at a discount. CKXE shares traded as recently as October 2010 as high as $5.30, during August 2010 at $5.50 and in July 2010 as high as $5.60. Additionally, at least one analyst has set a target price as high as $8.00 per share and CKXE shares were also down from over $10 in 2008, and at almost $15 per share in 2007.

Furthermore the plaintiffs allege that the defendants failed to maximize shareholder value. In fact last year in May CKX, Inc. (NASDAQ: CKXE) announced that it had received a proposal from a group of investors led by Simon Fuller to acquire all of the outstanding shares of common stock of CKX, Inc that it does not currently own for approx. $6.45 per share in cash, thus above the current offer, but then announced on October 27, 2010 that it was no longer discussing a potential sale of the Company or of a controlling stake in the Company.