Shareholder Gabelli Says Fisher’s In Play

Back when Huntingdon REIT made an unsolicited bid of $23.99 per share for Fisher Communications, investment fund manager Mario Gabelli pressed management to put the company up for sale and seek a higher price. Now Gabelli says a new bidder has made a better offer — and he wants to know why the Fisher board of directors isn’t telling shareholders.

Gabelli, whose GAMCO Asset Management funds own in excess of 28% of Fisher’s stock, sparred with Fisher President-CEO Colleen Brown in Tuesday’s 2Q conference call.

“Hi Colleen, you know that question I have to ask in a public forum like this because under [SEC] Reg. FD you have to disclose it to all shareholders,” said Gabelli as the largest shareholder addressed the Fisher CEO. “I’m sending you another letter today, if it isn’t already in your hands, detailing how you might structure a debt instrument to customize your own cash flows and EBITDA to give you flexibility on a going forward basis. And I also have to ask you a question that everyone in the trade brings to my attention — that is, that you have received a bid for the company, all-cash, north of $40 — $40 or better — from a strategic buyer. In the past Fisher has not told its shareholders that they’ve had these opportunities. What’s your philosophy for disclosure? What are you lawyers telling you about not disclosing something like that?”

“Mario, as you know, we’ve had this in front of us a few times and we just don’t comment on rumors, speculation, insinuations of any type — and this falls into that category,” Brown said in response.

“I don’t want to get argumentative, but to the degree that I could get somebody under deposition to point out that they did send a bid in and you guys talked about it and not disclosed it — is there a legal reason that you won’t disclose it to the shareholders?” asked Gabelli as he pressed the issue.

“Again, I appreciate your question, Mario, but it is not appropriate for me to comment on any kind of potential or future transaction or any kind of speculation or rumor. It’s just not appropriate,” said Brown as the conference call operator brought the session to an end.

Fisher’s stock closed Tuesday at $32.85.

“I don’t want them to sell the company,” Gabelli told TVNewsCheck shortly after the conference call. Rather, he said, he wants transparency from management about their plans for the company. And he sees the best financial course to be a recapitalization which would make a big cash payout to shareholders and keep the company intact.

Calling it “investment banking 101,” Gabelli told TVNewsCheck that he’s detailed in a plan sent to Fisher management how the company could pay out its $100 million cash hoard to shareholders, use its $45 million in cash flow to easily handle its debt load going forward and build up its assets.

Gabelli was complimentary of how Fisher’s management runs its stations, but not of its track record in buying additional stations — calling its Bakersfield, Calif., TV acquisition “a disaster.” What the big shareholder wants now is a recapitalization to pass out cash to shareholders, and he wants it to happen quickly, since he’s worried that the capital gains tax will go up from the current 15% level in a second Obama Administration.

“I want my clients to make money,” Gabelli said, so he doesn’t want them to sell their stock in the market for less if someone is willing to pay $40 per share for Fisher — and he thinks shareholders ought to be told when such an offer is made. If the board turned it down, then he wants to hear their reasoning. Gabelli insisted that he doesn’t know who made the $40 per share offer, but he wants management to tell shareholders whether there was such a bid and why it was rejected.