Harbinger Group offers to buy Central Garden & Pet for US$10/share, says it may increase its offer if CG&P's board will discuss the deal and open its financial books for examination; offer values CG&P's common shares at US$504.5M
June 23, 2014
– Harbinger Group said Monday that it has offered to buy lawn and pet supplies company Central Garden & Pet, and says it may increase its offer if the company's board would discuss the deal and open its financial books for examination.
Harbinger, the holding company run by hedge fund manager Philip Falcone, has offered $10 per share for the company's common shares, an 11 percent premium from Friday's close, as well as its Class A and Class B stock. The offer values its common shares at about $504.5 million.
The buyer would also assume $545 million in debt, raising the cost to Harbinger at about $1.05 billion, a Harbinger spokesman said.
Harbinger said it is also willing to buy just Central Garden & Pet's pet food and supplies unit for $750 million in cash.
The proposal comes two weeks after Harbinger asked in a letter to meet with Central Garden & Pet's management and urged it to consider selling itself to Harbinger. Harbinger said Central Garden & Pet has not responded to repeated attempts to discuss a deal.
A Central Garden & Pet representative did not respond to a request for comment. The company is based in Walnut Creek, California.
New York-based Harbinger owns 4.4 percent of Central Garden & Pet's common stock and 4.5 percent of its Class A common stock.
In morning trading Monday, Central Garden & Pet Co.'s common stock rose 80 cents, or 8.9 percent, to $9.80. Harbinger's shares rose 17 cents, or 1.3 percent, to $13.13.
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