Judge rules against Emmis shareholders, allows sale

July 27, 2010

A Marion Superior Court judge on Tuesday denied a motion that sought to temporarily block the buyout of Emmis Communications Inc.

The Indianapolis-based public company, which owns 23 radio stations in the United States, in May consented to a purchase by JS Acquisition LLC, a private company formed by Emmis Chairman and CEO Jeffrey H. Smulyan. The acquisition price is more than $500 million when including assumption of debt.

Emmis shareholders challenged the acquisition and sought a temporary restraining order to block it.

Plaintiffs’ lawyers argued in Marion Superior Court that the Aug. 3 deadline for shareholders to accept a buyout offer should be delayed until they have more information to make a decision.

But Judge Robyn Moberly said the shareholders “failed to show a likelihood of success on the merits of any of the claims.”

JS Acquisition is offering $2.40 a share in cash, a 12-percent premium to the closing price of $2.14 on May 26, the day Emmis’ board unanimously approved the transaction. The offer was announced on April 26.


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