Shamrock Activist Value Fund, owner of 6.4% of Reddy Ice Holdings, Inc. (NYSE: FRZ), has released an open letter to shareholders arguing against a proposed buyout at $31.25 a share by GSO Capital Partners.

Reddy Ice is a manufacturer and distributor of packaged ice products in the U.S., most prominently bagged ice found in supermarkets and convenience stores.

The letter highlights what Shamrock claims are numerous "deficiencies" in the sale, most prominently a conflict of interest with company management:

"Shareholders should look closely at the motivations of management in pursuing this transaction. As recently disclosed by the Company, members of senior management may acquire an equity interest in the Company following the acquisition. Why would management seek to purchase an equity interest in the Company post-acquisition if, as disclosed by the Company, management and the Board of Directors, truly believes “that the $31.25 per share merger consideration would result in greater value to our shareholders than pursuing our current business plan?” If that statement is more than just hollow rhetoric, then it is hard for us to understand why management would invest in the transaction at $31.25."

Instead, Shamrock proposes a buyback of 15% of outstanding shares by the company at $33 a share, satisfying those that want to liquidate their position as well as shareholders who "believe in the company's future" and want to retain a stake in it.

The letter reminds shareholders that Reddy Ice has yet to realize the benefits of more than 20 acquisitions it has made in the last two years. Also, company management recently stated that "unusual" weather has negatively impacted recent financial results. In other words, the company is poised for growth and and better returns, making this the worst time to sell and the best time to buy - which is exactly why management is attempting to convince shareholders to sell so they can share in the upside of a purchase.

Finally, Shamrock says its own discounted cash flow analysis of the company values it at $42 to $44 a share, significantly more than the $29.60 it is currently trading for and the $31.25 GSO is offering. And this definitely makes FRZ a stock worth watching!

Borse Dubai, which was formed by the emirate's government and controls the Dubai Financial Market and Dubai International Financial Market Exchange, plans to buy at least 25% of Sweden's OMX AB, which operates European exchanges in cities such as Helsinki and Stockholm.

Nasdaq Stock Market, Inc. (NASDAQ: NDAQ), the operator of the NASDAQ Stock Exchange, was in the process of a takeover of OMX valued at $3.7 billion; however, Borse Dubai has already purchased almost 5% of OMX for 230 kronor per share, an 11% premium over the 208.1 kronor per share Nasdaq agreed to pay for the exchange operator. Also, Borse Dubai has entered into an option agreement to acquire another 22.5% of OMX at 230 kronor per share.

Nasdaq has asked OMX shareholders to ignore the Borse Dubai bid, but Nasdaq shares are actually up almost 5% on news as it is seen as creating the possibility of a larger deal between the three companies.

Any deal with Borse Dubai would but Nasdaq in a better position to compete with its biggest rival, the New York Stock Exchange, which has already inked a deal combining it with the large European exchange Euronext to form NYSE Euronext (NYSE: NYX).

Nasdaq recently failed in a takeover attempt of the London Stock Exchange that would have kept it competitive with NYSE in the European exchange market. Its $5.3 billion bid fell apart in the face of LSE management resistance. Many analysts feel that without a better foothold in Europe, any new attempt to by Nasdaq to purchase the LSE is also doomed to fail.

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Blockbuster Inc. (NYSE: BBI) announced today that it purchased movie download service Movielink, though terms of the deal were not disclosed.

Movielink was launched in 2002 by a collaboration between Metro-Goldwyn-Meyers Studios, Paramount Pictures, Sony Entertainment Pictures, Warner Bros., and Universal Studios. This stable of major film studio backers allow Movielink to offer some 3,300 movie titles available for legal download.

The deal can largely be seen as a response to Netflix Inc. (NASDAQ: NFLX) offering subscribers the ability stream movie titles from its website.

In an interview James Keyes, Blockbuster's CEO, said "We're taking a fresh look at the future of Blockbuster. The popularity of [online rentals] convinced us that customers are ready for more convenient forms of digital delivery that we think Blockbuster can successfully enter."

Blockbuster Total Access, Blockbuster's mail-delivery movie service in the mold of its main competitor Netflix, has less total subscribers than its rival but is growing much faster. In fact, in the second quarter of this year Netflix lost 55,000 subscribers - its first quarterly decline ever - while Blockbuster added 660,000 thanks to aggressive advertising and pricing.

Despite these numbers Netflix is still the clear leader of movies-by-mail with some 6.7 million subscribers to Blockbusters 3.6 million; however, both services see that the future almost certainly lies in digital content delivery.

Sources familiar with Blockbuster's purchase of Movielink say talks began in February for a cash-and-stock deal worth about $50 million, though an insider said yesterday that the deal was for all cash and worth significantly less than that figure.

The aggressive strategy to continue attacking Netflix on every front definitely makes BBI a stock worth watching!

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