A foreshadowing of things to come, if management does not start focusing on shareholder value?
nytimes.com
"Alltrista Holder Urges Privatization
Filed at 6:19 p.m. ET
By Reuters
WASHINGTON (Reuters) - A dissatisfied shareholder urged Alltrista Corp. (ALC.N), a maker of plastic and metal products, to take the company private in a transaction that would pay $30 a share, nearly a 40 percent premium over Thursday's closing price.
Marlin Partners II LP, which holds a 9.1 percent stake in Alltrista, said it had become ``frustrated'' with poor progress in enhancing shareholder value. No potential buyer was named in the proposal, according to a filing with the Securities and Exchange Commission.
``We have no interest in launching a hostile bid but believe that our proposal will meet with overwhelming shareholder support,'' Martin Franklin, the chairman and chief executive of the private investment partnership Marlin Capital LP, said in a letter to Alltrista's board.
Alltrista Chairman and Chief Executive Officer Thomas Clark said in a written statement that the conditional proposal would be referred to the corporation's board of directors for its consideration.
Shares in the Indianapolis-based company closed 3-1/16 higher at 24-3/4 on Friday, up from its 52-week low of 20-3/8, but off its year high of 34.
With 6,305,816 shares outstanding as of March 17, the privatization plan would cost approximately $189.17 million.
Alltrista's stock closed at 21-11/16 on Thursday.
The company, which sells canning jars, plastic formed containers, plastic door liners and evaporator trays for refrigerators, reported $29.2 million in net income last year, up 85.6 percent from $15.7 million in net income in 1998.
Franklin said a forecast made by Clark for 2000 ``is already at risk due to a disappointing first quarter performance at recently acquired Triangle Plastics.''
He said that during several conversations with Clark and the company's chief financial officer, Kevin Bower, both expressed interest in the idea of exploring a delisting.
``They too have found the experience of public stagnation unrewarding and a drag on recruitment, incentive and acquisition opportunity,'' Franklin said in the letter.
``We are perplexed that the board has not taken the initiative to create value through privatization as the best strategic alternative for the company,'' he said.
Officials of the company could not be reached for comment.
The deal would be structured as a tender offer, according to Marlin's proposal, which was included in the SEC filing.
Plus, Alltrista would be allowed to respond to any unsolicited inquiry from a third party regarding the purchase of the company as long as Marlin was informed about the deal and the proposed terms of the acquisition."
Morgan |
