Reading International Shares Go Crazy After Cuban Discloses Large Activist Stake

In a recent SEC filing, famed billionaire businessman and TV personality Mark Cuban said he owns an activist stake in Reading International, Inc. RDI RDIB, comprising 207,611 shares of Class B Voting Common Stock (representing 13.1 percent of the total Class B shares outstanding) and 72,164 shares of Class A Nonvoting Common Stock.

This position makes Cuban the second-largest investor in the company - in terms of voting power, only surpassed by the shares held by the estate and trusts of the late James Cotter Sr., who passed last year. Since his death, the company has seen itself immersed in a family feud over the administration of the theaters the company operates and the CEO position, which was first taken by James Cotter Sr.’s youngest son, James Jr., who was then replaced by his sister Ellen, after a part of the Board pretty much “fired” him.

James Jr. and the company are now involved in a legal battle. And, it seems like Cuban wants a say in the whole thing now.

Since the billionaire’s stake was disclosed on Monday, Reading’s Class B shares fell 2.2 percent, while Class A shares rose 2.72 percent. And the shares seem to keep moving in opposite directions; on Wednesday trading, Class A shares are down more than 1.5 percent, while Class B shares are up more than 2 percent.

While voting stakes in the company are quite limited, there are several major funds that hold nonvoting wages on Reading. For instance, Jim Simmons’ Renaissance Technologies last disclosed ownership of 629,100 shares, representing 2.7 percent of the Class A outstanding stock. Other funds betting on the company include Dimensional Fund Advisors (700,242 Class A shares) and Acadian Asset Management (480,325 Class A shares).