OpenTV ‘not favourably positioned’
Chris Forrester
26-10-2009

The Kudelski Group on Oct 26 issued further particulars about its planned Tender Offer for the remaining shares it does not already own or control in OpenTV. It issued its offer on Oct 5 offering $1.55 a share. The offer has been criticised by some shareholders. Kudelski issues a dire warning about OpenTVs prospects saying that without Kudelski’s further investment OpenTV, as a stand-alone unit, has a doubtful future.

Kudelski’s statement says: “As detailed in Kudelski’s [offer] materials, the tender offer provides all OpenTV shareholders an attractive exit option based on the following key factors:

(1) the offer provides significant premiums versus recent and unaffected OpenTV trading levels and enterprise values,

(2) OpenTV is not favorably positioned as a standalone public company and will need to invest significantly in the business to ensure its mid- and long-term sustainability,

(3) the required investment at OpenTV will likely diminish OpenTV’s profitability and may negatively impact shareholder value in the near-term,

(4) the offer provides the only near-term solution to an otherwise illiquid security, particularly for the larger institutional shareholders, and

(5) Kudelski expects OpenTV will become even more illiquid as a result of the tender offer.”

As disclosed in a Schedule 14D-9 filed with the SEC on October 20, 2009, the OpenTV board of directors is remaining neutral regarding the tender offer and recommends each shareholder make their own decision on the offer based on all available information. Kudelski continues to encourage OpenTV shareholders to act before the tender offer and withdrawal rights expire at 5pm New York City time on Friday, November 6, 2009.