Liberty Media Corp. has reportedly upset some big investors with what is being dubbed a low offer for the shares it doesn't already own of its affiliate company, Liberty Satellite & Technology Inc.
The Wall Street Journal reports in an offer disclosed late on Oct. 12, Liberty Media said it would offer stock currently valued at $1.09 a share for each share of Liberty Satellite it doesn't already own. While Liberty Satellite is now trading just below that value, closing unchanged at $1.04 Friday on the OTC Bulletin Board, it has traded above $7 in the past year, and above $20 within the past two years.
Liberty Media owns about 12.5% of the common shares outstanding of Liberty Satellite but it controls the company through supervoting preferred stock, which gives it about 85% of the votes.
The $1.09-a-share offer values Liberty Satellite's common equity at $82 million.
"It stinks," Alan Snyder, president of Snyder Capital Management LP, told the Journal. His company reportedly has around two million shares in Liberty Satellite. He maintains the company is worth "at least two or three times what the offer is."