Other People's Money
While we are in a bit of summer hiatus, as Ackman is going through the mechanics of his game and the Board is running the clock down before doing anything dramatic, I thought I'd lighten the thread a bit with a movie recommendation. 
The movie is Other People's Money, a 1991 comedy-drama starring Danny DeVito and a 75 years old Gregory Peck (I believe it was his last full movie). The plot revolves around, you guessed it, a hostile takeover. The reason for the recommendation is the outstandingly (for Hollywood) accurate portrayal of the rationale and process of a hostile takeover. The financial and legal maneuvers by the takeover investor (DeVito) and CEO (Peck) are all from the standard playbook and are properly explained at every step. They even use the correct SEC form numbers. Basic concepts such as Green Mail, Balance Sheet, Proxy Fight, shares buyback, and others are presented in a clear and compelling fashion. The final speeches (immediately before the decisive shareholders vote) given by the two antagonists provide a fair presentation of the competing arguments (real takeover fights, at least in modern times, don't actually have dueling live speeches -- that's a Hollywood dramatization -- but the concept of the two sides presenting their arguments to the voting shareholders is quite accurate).
There are major subplots of sexual tensions and family dynamics involving the smart and hot attorney (Penelope Ann Miller) and the antagonists (or, maybe those are the major plots, and the hostile takeover is actually the subplot -- can't be really sure ). While it may seem that these dynamics are significantly impacting the actions taken by the two sides; in fact they do not, the actions each side is taking is exactly as they would have at that point in any event -- and whenever they agree to do something that would be different; they break their words immediately and make it obvious they never intended otherwise. So, if you are watching the movie to see how a typical hostile takeover plays out, rest assured that these dynamics are not interfering with the developments in the least bit.
(In a real situation, the slightest hint of any such dynamics would be more than just a harmless no-no -- it would destroy the careers of all involved -- but here too, I give Hollywood a creativity license; without such subplots, a movie about hostile takeovers would be 90 minutes of watching suit people redlining legal documents ).
I do want to add an important comment with regard to the Allergan-Valeant battle: The takeover target of the movie is an old-style industrial company that was going through a protracted decline -- the typical target of successful hostile takeovers. Allergan, is far from it; it is an above-average growing company with a strong pipeline -- almost never the target of a successful hostile takeover fight (I'll probably dedicate a post to just this subject at some future point). If you choose to watch this movie to learn more about hostile takeover, note that there are many similarities in the process; but also crucial differences in the target.
Get some popcorn, and enjoy!
Dan.
