Nielsen’s acquisition by Elliott Management is still underway, with the companies last week receiving regulatory approval for the $16 billion transaction – scheduled to close in the second half of this year. Now they await Nielsen shareholder approval, which could potentially face some difficulty.
According to an SEC Form 8-K dated July 29, Nielsen has received eight demand letters – filed by purported Nielsen shareholders – alleging the company provided misleading information in proxy statements made on May 19 and July 8.
These alleged omissions, Nielsen wrote in the most recent proxy statement, relate to information such as “certain financial projections of Nielsen” and “the financial benefits to Nielsen executives and Board members from the acquisition.”
Nielsen of late has faced scrutiny from the media industry and on the legal level. The company lost its TV ratings accreditation last September from the Media Rating Council (MRC) for allegedly unreliable audience measurement. Allen Media Group filed a lawsuit in March alleging similar concerns.
Nielsen asserted in its Form 8-K that the shareholder allegations “are without merit and that no additional disclosures were or are required under applicable law.”
Financials-wise, Nielsen saw $882 million in revenue for the second quarter, up 2.4% year on year. Regaining industry accreditation is also a possibility, as Nielsen CEO David Kenny has stated MRC members are scheduled to vote on re-accreditation later this year.
Nielsen shareholders are scheduled to convene for two meetings on August 9. The “Court Meeting” will have shareholders vote for the acquisition’s approval, while the “Special Meeting” will have them consider certain proposals related to the transaction. One of which concerns how much Nielsen executives will be paid in compensation as part of the deal.
The Form 8-K further noted neither Kenny nor any other Nielsen executives have secured post-closing positions, should the transaction go through. But the consortium led by Elliott Management may offer “management incentive arrangement” for Nielsen executives choosing to stay on with the company.