UPDATE: IDG accepts offer from Luther King Capital Management
Industrial Distribution staff -- Industrial Distribution, 4/28/2008 6:16:00 AM
Industrial Distribution Group Inc. will accept an offer from Luther King Capital Management to be acquired for $133.9 million, $12.10 per share.IDG made the announcement late Friday, April 25, after the close of trading.
Platinum Equity Advisors LLC gave formal notice to IDG on Friday afternoon that it would not exercise its right to match or exceed the LKCM offer.
LKCM’s offer was to have expired at midnight on Saturday, April 26.
"We are very excited about this transaction with Luther King Capital Management, which we believe provides excellent value to our stockholders," Richard Seigel, IDG's chairman of the board, said in a statement. "We believe that this transaction with our largest stockholder is a great fit for both IDG and Luther King Capital Management."
IDG’s board of directors will withdraw its previous recommendation of the Platinum Merger Agreement, and recommend that its stockholders vote to adopt the LKCM Merger Agreement. During the week of April 28, the board will also approve a new date for the special meeting of stockholders to vote on the LKCM Merger Agreement.
The offer trumped the $130.6 million, $11.80-per-share proposal submitted by Platinum Equity April 22, which prompted a third suitor, Wesco International Inc., to bail out of the race.
"At a special meeting [April 22], the board unanimously determined that the $12.10 per share LKCM offer is a 'superior proposal' relative to the Platinum Equity offer, and that [IDG] would not accept the offer from Platinum Equity," IDG said last week in a statement. "The company has notified Platinum Equity that the board of directors intends to withdraw its recommendation of the pending acquisition of [IDG] by Platinum Equity in order to accept and recommend the LKCM definitive offer of $12.10 per share."
The bidding war over IDG began with Platinum’s initial offer of $113 million, or $10.30 per share.
IDG’s board accepted that offer, but later revealed that an entity then known only as “Bidder D”—which turned out to be Wesco, the parent company of Wesco Distribution—had submitted a $120.7 million, $11 per-share counter-offer.
Then LKCM said it would pay $128.4 million ($11.70 per share), prompting Wesco to up the ante with a $130 million, $11.75-per-share offer.
That was trumped April 22 with the most recent Platinum Equity offer, which was in turn superseded by the LKCM bid late the same day.
Stay tuned to INDUSTRIAL DISTRIBUTION for full coverage of this story.
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