Will News Corp's Acquisition of MIX be IntermixedUp?

War has broken out over Intermix (ticker: MIX). Brad Greenspan, founder and CEO until October 2003 and currently the largest independent non-insider shareholder (he owns about 10% of the company) has launched a compaign to get shareholders to vote against the sale of Intermix to News Corp. (ticker: NWS). He argues that Intermix was worth considerably more than the $12 per share News Corp offered, and has since appreciated in value. But he also throws some serious allegations at Intermix's current management team. The key allegations:

• "Intermix Management and other Insiders sold approximately $25 million of Intermix stock in full knowledge that the New York State Attorney General (NY-AG), Eliot Spitzer, would soon file a lawsuit against the company for certain adware promotion activity. Management and Insiders sold vast quantities of stock before disclosing this critical information appropriately to the rest of the marketplace."
• Intermix misrepresented the nature of its Adware downloads to the NY-AG, and actually ramped distribution of them - including purchasing advertising on web sites targetted at children - during the investigation.
• "Intermix CEO created a scheme to inflate the unique visitors reported for Grab.com in a string of press releases prior and during the Insider stock sales occurring."
• "The proposed News Corp. transaction is a sweet-heart deal that diverts millions of dollars to insiders at the expense of other stockholders". Specifically, $150 million has been set aside to provide legal protection for the Intermix Board of Directors.

Mr Greenspan has detailed his allegations on a website, aptly named IntermixedUp.com.

Related:

• Don’t short junk - implications of News Corp’s purchase of Intermix (NWS, MIX)
• Full text of Spitzer’s petition against Intermix Media
• Is this Intermix Media’s press release in plain English?
• Intermix Network - MIX - on user-generated content and viral marketing (quotes from the 4Q04 conf call)
• All Internet Stock Blog articles on Intermix.
• The complete list of Internet stocks (and links to articles about them) covered by The Internet Stock Blog.

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