The offer from Hearst Corporation to buy out other shareholders of Hearst-Argyle Television has been rejected by the special committee of independent directors at Hearst-Argyle. They say the offer of 23.50 per share (8/27/07 TVBR #167) is not enough.
The statement released after the market closed yesterday states that the special committee unanimously determined that the offer is "inadequate and not in the best interests of Hearst-Argyle Television stockholders, other than The Hearst Corporation and its affiliates." The independent directors advised public shareholders to reject the offer and not tender their shares. "The Special Committee made its determination and recommendation based upon various factors, including, among other things, the belief that the offer undervalues the shares of Series A Common Stock of Hearst-Argyle Television, and does not adequately reflect the prospects and value of the Company," the statement said.
Hearst-Argyle Television owns 26 television stations and manages three others. It also manages two radio stations which are owned by Hearst Corporation.
RBR/TVBR observation: Hardly a surprise. Investors had been pressing for a higher price since the Hearst Corp. offer was made and the stock has consistently traded well above the 23.50 offer since the day it was issued. Hearst-Argyle closed yesterday at 26.05.Now we wait to see if Hearst Corp. comes up with a better offer to acquire the 27% of Hearst-Argyle that it doesn’t already own.