CNBC Covers New Frontier 'Takeover Battle'

NEW YORK—Characterizing the two unsolicited offers for publicly traded New Frontier Media as a looming "takeover battle," CNBC published an article Wednesday on the competing bids by a disgruntled member of the New Frontier family, majority shareholder Longkloof Limited, and outside suitor, adult powerhouse Manwin.

Longkloof made its hostile bid first on March 9, offering $1.35 a share along with a brutal denunciation of the company's board of directors. Manwin followed this week, offering $1.50 a share along with a more complimentary assessment of the company. New Frontier has acknowledged the receipt of both offers and has formed a committee to review them.

CNBC noted the concerns expressed by Longkloof in a blistering letter to the board that stated, in part, "We do not believe the current Board is capable or willing to undertake the actions necessary to enable NOOF to compete in the future, as the track record established by the current Board over the past several years has been dismal. Unfortunately, we believe the current Board is more focused on maintaining its excessive director fees and engaging in related party transactions, rather than running the Company in the best interest of the stockholders."

Calling Manwin's approach "vastly different," the financial network said of the country, "Manwin isn't a particularly well-known name outside of porn (in large part because it operates as a holding company), but it has quietly become one of the industry's largest players in the past two years."

The network also contrasted the difference between the apparent intentions between the two companies bids. "While Longkloof's offer would almost certainly result in New Frontier going private," wrote Chris Morris, "Manwin's intentions are less apparent. It could easily take the company private as well, but it could also use the acquisition as a stepping-stone to become a publicly traded entity, something [Manwin CEO Fabian] Thylmann teased in January at a keynote speech at Internext, an industry-only conference held immediately before the Adult Entertainment Expo."

The article also notes that sales at New Frontier, which "produces many of the films that air late at night on Cinemax and Showtime, have declined regularly over the past five years and the company has posted losses for the past two fiscal years. Last year, it posted net revenue of $50.4 million."

New Frontier has not said when it will announce its decision on the competing bids.