World Market Media's  Instablog

As season 9 of American Idol came to a close on Wednesday, talk about the company who owns the rights to IDOL are heating up. CKX Inc. (NASDAQ: CKXE), who owns the rights to IDOL and So You Think You Can Dance television brands, as well as an 85% share in Elvis Presley Enterprises and 80% share in Muhammad Ali Enterprises, has been in discussion as the possible target of a buyout.

Simon Fuller, the creator of American Idol, has teamed up with a former Barclays Capital executive to formulate a $600M bid for CKX. Mr. Fuller has been in discussions with Roger Jenkins, an ex-Barclays Capital tax expert, for months and the two have amassed a $1billion fund, however, don't have a name for their venture, according to one person familiar with their negotiations.

The stock is trading at $5.35 up $1.03 or 24% as investors saw the $600M bid as high compared to the valuation of the company according to the closing price of $4.32 on Thursday. If you were to multiply the 93.6M shares outstanding by Thursday's closing price of $4.32 the company's valuation would be just a touch over $400M so it's no surprise that the stock has jumped over a dollar today. The company did have about $100M in debt and $55M cash on hand at the end of last quarter.

Robert Sillerman former chairman and chief executive of the company who resigned earlier this month remains the majority shareholder at about 21%. Sillerman along with the Presley family will be a major factor in a decision concerning accepting this bid

This news comes just a day after Simon Cowell, star judge of American Idol, announced he would not return for a season 10. It appears to me that American Idol is in the twilight of its career as Season 9 had low ratings compared to seasons passed. And now that Simon is gone who's going to watch? We will keep you updated with any further news concerning this bid.



Disclosure: no positions