Metromedia ordered to schedule shareholder vote to approve asset sale

By Caroline Salls

Pittsburgh, Nov. 30 - Metromedia International Group, Inc. cannot enter into a sale of substantially all of its assets without a vote of its shareholders under a ruling by the Delaware Court of Chancery, according to an 8-K filing with the Securities and Exchange Commission.

The ruling also applies to the sale of subsidiary Metromedia International Telecommunications, Inc. and the company's interest in Magticom.

In addition, the chancery court ruled that Metromedia is required to encourage stockholders to attend the meeting and cast a vote on any proposed sale.

As previously reported, two lawsuits were filed by stockholders Esopus Creek Value LP., Black Horse Capital, LP, Black Horse Capital (QP) LP and Black Horse Capital Offshore Ltd. to enforce a Sept. 26 stipulation and court order under which the company agreed to hold an annual meeting of stockholders on Dec. 15.

The lawsuits alleged that, by entering into a letter of intent for the proposed sale of substantially all of its assets, Metromedia intended to avoid holding the annual meeting and, in connection with the approval of the letter of intent, some Metromedia officers and directors breached their fiduciary duties and attempted to avoid a stockholder vote on the sale transactions.

Charlotte, N.C.-based Metromedia owns interests in communications and media businesses in the country of Georgia.

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