CKX Stays Public
19X Inc. has backed out of its plans to take CKX Inc., which holds the rights to the name and likeness of Elvis Presley and Muhammad Ali, private due to current economic conditions.
On Monday the privately held 19X, which is controlled by CKX Chairman and Chief Executive Robert F.X. Sillerman and by “American Idol” creator Simon Fuller, said in a filing with the Securities and Exchange Commission that it ended its agreement with media licenser CKX in a letter to the company’s board.
Tightening credit conditions have made it more difficult for businesses to obtain the financing needed for buyouts, leaving many companies to abandon or postpone their plans.
Privately held 19X is now responsible for a $37.5 million termination fee, which it said will be paid for with about 3.3 million shares of CKX common stock valued at $11.08 per share and $500,000 in cash. The company said it will pay the fee in full within 30 days of the deal’s termination date.
In September 19X said it was calling off its $12-a-share bid for CKX. At the time the company blamed turmoil in the financial sector for its decision, but Sillerman said in a release that he planned to approach CKX’s board with an alternate acquisition proposal by Oct. 31.
In its termination letter sent on Saturday, 19X said Sillerman and Fuller plan to continue looking at alternatives to acquire CKX.
Shares of CKX added 21 cents, or 5 percent, to $4.39 in morning trading. Over the past year, the stock has traded between $3.29 and $12.79.