Reddy Ice Holdings (NYSE:FRZ) shares moved up $0.07, or 0.23%, to $31.01 today after the Shamrock Activist Value Fund disclosed another letter challenging the board to reconsider a planned buyout by GSO Capital Partners. The activist hedge fund continues to oppose the transaction, calling it grossly inadequate, and has finally garnered some support.

The packaged ice distributor announced the $1.1 billion - or $31.25 per share - buyout deal with GSO Capital in early July and immediately drew shareholder criticism. Regardless, the company quickly moved to approve the transaction which is set to close in the fourth quarter. Many shareholders are concerned that management buyout bonuses and other incentives may be clouding the board's judgment at the expense of shareholders.

The Shamrock Activist Value Fund announced today another interesting piece to the story. The hedge fund uncovered the fact that the company appears to be abandoning its duty to maximize shareholder value by minimizing opposition to the buyout bid. This is being done by encouraging certain large shareholders to speak directly with GSO Capital about rolling their FRZ shares into the GSO leveraged buyout transaction instead of tendering them for cash. Clearly, this is unfair to smaller shareholders that represent the majority ownership in the company!

Shamrock insists that the company should immediate abandon the proposed buyout transaction and instead institute a share buyback at $33 per share to allow apathetic shareholders to exit the stock while allowing existing shareholders to retain their stake. The current game management is playing of "buying off" support for the transaction is simply unfair and unethical - a clear breach of the board's duty to serve shareholders as a whole. While Shamrock still faces an uphill battle, this is definitely a story worth following!