Outdoor Channel Favors Kroenke Takeover

Outdoor-channel-AAA plan to create a two-network player in the outdoor enthusiast space may have hit a wall. Outdoor Channel Holdings says it has determined that a takeover offer from Kroenke Sports & Entertainment is preferable to a previously agreed-upon merger with an InterMedia Partners entity.

The InterMedia arrangement would have paired the Outdoor Channel with the Sportsman Channel and a run of enthusiast magazines.

The Outdoor Channel board has concluded that the Kroenke Sports offer to buy the company at $8.75 a share meets a “superior proposal” standard. That's compared with the InterMedia arrangement announced last fall, which offered stockholders $8 a share or another option.

The Outdoor Channel said terms of the Kroenke Sports deal have been negotiated -- with one benefit being Stan Kroenke, who controls the eponymous company, agreeing to “personally guarantee” his company’s financial burden if the deal is consummated. The wealthy Kroenke, a significant Outdoor Channel shareholder, controls multiple sports teams.

InterMedia does have until March 12 to alter the terms of its arrangement to better appeal to the Outdoor Channel board. If InterMedia fails, Outdoor Channel would owe it a $6.5 million breakup fee.

But there is an interesting dynamic that might play a role. Outdoor Channel shares are trading higher than the $8.75 Kroenke Sports has offered.



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