Allen sells shares in DreamWorks
Mogul resigns from board of animation studio
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Goldman Sachs has agreed to underwrite a public offering of 10 million of the mogul's shares, which should bring him more than $300 million.
In an effort to minimize the dilutive effect of the new offering, DreamWorks Animation will spend $150 million to buy back additional shares from Allen. Company will pay the same price as Goldman Sachs, which should result in its acquisition of between 4 million and 5 million shares.
Once both transactions are complete, the billionaire Microsoft co-founder will be left with between 6 million and 7 million shares, or about 6% of the company's total outstanding stock. At the current trading price, that stake would be worth around $200 million.
Allen was entitled to a seat on DWA's board so long as his ownership stake remained above a certain level. With the latest sale, he fell below that level and lost his spot.
Allen's departure from the board and the loss of his status as a major shareholder marks a big change for DreamWorks 12 years after the company was founded.
He was its primary financial investor, putting about $600 million into the company over the years. He made back some of that when the live-action studio was bought by Viacom, while the rest of his equity was turned into DreamWorks Animation stock.
Last fall, Allen triggered a secondary stock offering by DWA that brought him at least $220 million.
"I am pleased to have been a principal investor in DreamWorks since its inception and proud of the company's many successes to date," Allen said in a statement.
Sale comes as DreamWorks Animation stock has recently hovered around $33 in the wake of "Shrek the Third's" success. Shares haven't been that high since early 2005, soon after the company's IPO.
In after-hours trading, DWA shares were down 3% on the news of the new public offering.
