The fight over Royal KPN’s attempted buyout of iBasis escalated today as the Dutch telco responded to iBasis’ allegations and filed a lawsuit of its own.
In a formal response filed in Delaware Chancery Court, KPN called the iBasis lawsuit “entirely baseless” and said it was being used as an “improper tactic” to block its buyout offer.
KPN also filed a counterclaim against iBasis and some of its directors which asked the court to invalidate the “poison pill” purportedly adopted by the international call termination service provider.
According to KPN, the “poison pill” violates iBasis’ own bylaws and the terms by which KPN originally invested in the company. KPN currently holds a 56 percent stake in the company.
Last month, KPN made an unsolicited bid to buy the remaining portion for $1.55 a share, or about $49 million. At the time the offer was made, the deal represented a 19 percent premium over the company’s stock price. iBasis stock is currently trading at about $2.24 per share.
After review by a special committee, iBasis rejected the tender offer and filed a lawsuit to stop the buyout.
iBasis alleges that the offer was an attempt to artificially depress its stock so that KPN could buy its shares at a discount. The company bases its accusations on an internal document purported to show that KPN expects the company to perform better than it publicly stated.
Today, KPN said it would refute the “false and misleading” claim in an amendment to its buyout offer filed with the SEC. Among other things, the amendment provides additional detail that counters iBasis’ accusations about certain “strategic scenarios prepared by KPN and disclosed by the iBasis Special Committee.”
KPN faces opposition from three of iBasis’ largest shareholders. Millennium Management, Lloyd I. Miller III and Karen Singer have all sent separate letters to iBasis stating they would not sell their shares under the terms of KPN’s offer.