Murdock's low-ball bid for Dole may ultimately prevail. (Wall Street West).If money talks, then last week David Murdock, chairman of the Westlake Villagebased Dole Food Co., made the most explicit commentary possible that a skittish skit·tish adj. 1. Moving quickly and lightly; lively. 2. Restlessly active or nervous; restive. 3. Undependably variable; mercurial or fickle. 4. Shy; bashful. Wall Street is undervaluing stocks: He offered more than a 20 percent premium to buy the 75.9 percent of Dole that he doesn't already own. Total offer price: $1.26 billion. "Dole is in a very cyclical business. As a result, our financial results fluctuate greatly," Murdock, 79, said in an interview with the Business Journal last week. "Given these uncertainties, I believe I have made a fair offer of $29.50 a share. It represents a premium of more than 20 percent above the closing price before I made my offer." In a Sept. 22 letter to Dole's board, Murdock complained that despite his best efforts, Wall Street has shied shied 1 v. Past tense and past participle of shy1. shied Verb the past of shy1 or shy2 away from Dole. "The company's attempt to enhance shareholder value over the years through such measures as restructurings and improvements to existing businesses, cost reductions, investments in additional businesses for growth and diversification, and a recent dividend increase have had little impact on the company's stock price," Murdock wrote. But there is doubt the premium is in the normal range. The average "going private" takeover for a public company has required a premium of 30 percent or more to the market price, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. figures compiled by Mergerstat, an arm of Houlihan Lokey Howard & Zukin. By that measure, Murdock's bid is a tad on the low side -- and Wall Street early last week seemed to concur CONCUR - ["CONCUR, A Language for Continuous Concurrent Processes", R.M. Salter et al, Comp Langs 5(3):163-189 (1981)]. , with traders pushing Dole's stock up past $30 a share. In a similar bid for Castle & Cooke, the old real estate arm of Dole Food, Murdock initially placed a low offer, which was upped before he eventually took that company private. By the middle of last week, however, Dole's shares traded down slightly, to just under Murdock's bid price, indicating a mood change. One money manager said he expected Murdock to prevail, and at his bid price. "Murdock dominates the board, and is already a large shareholder," observed Robert Nichols Robert Nichols may refer to:
adj. 1. Of or moving toward the quarter from which the wind blows. 2. Of or on the side exposed to the wind or to prevailing winds. adv. In a direction from which the wind blows; against the wind. Capital Management Co., a money management shop. "Knowing that he is such a dominant player makes it less likely that other bids will emerge." Contributing columnist Benjamin Mark Cole Mark Cole is a multi-instrumentalist blues and roots musician based in Gloucester, UK Music Mark primarily writes and performs blues music but also writes and performs music influenced by other American roots music genres such as americana, cajun, zydeco, bluegrass and can be reached at sevencontinents@mindspring.com. |
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