US Schulman open to revising Ferro bid, says management

22 April 2013 16:27  [Source: ICIS news]

LONDON (ICIS)--US plastics and resins maker A Schulman called on Monday for the management of Ferro to seriously consider its takeover offer for the specialty chemicals firm, adding that it is open to revising its bid.

Schulman rejected Ferro’s characterisation of its $6.50 (€4.94) per share takeover bid for the company as a “low-ball” offer, but said it would be willing to adjust the offer following due diligence investigations into Ferro’s financials.

“Our proposal is not a 'low-ball' offer, and we have publicly stated that we are open to revising the terms and structure of our initial offer, provided we are given an opportunity to conduct customary due diligence and engage in a meaningful dialogue with Ferro,” said A Schulman CEO Joseph Gingo.

Schulman’s bid for Ferro, representing an equity value of $563m and an enterprise value of $855m, was made public on 4 March this year after Ferro’s board opposed the offer.

The board has found itself embroiled in a proxy fight with some of its shareholders, who stated that Schulman’s bid was too low, but that Ferro should not have dismissed the offer without attempting to negotiate a higher price.

Key among those shareholders are US hedge fund Frontfour Capital, and chemical industry investor Quinpario Partners.

Schulman added that a “large majority” of the shareholders it has contacted believe that Ferro should have opened negotiations with the company, rather than rejecting the offer outright.

“Representatives of A Schulman have spoken directly to Ferro shareholders representing approximately 50% of total Ferro ownership, and a large majority of them indicate that the Ferro Board should not have summarily rejected the offer,” the company added.

($1 = €0.76)


By: Tom Brown
+44 208 652 3214



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