WRAPPED UP? REYNOLDS SAYS YES TO ALCOA BUT GIVES OTHER SUITOR CHANCE TO FOIL THE WEDDING.Byline: Jeffery Bair Associated Press Associated Press: see news agency. Associated Press (AP) Cooperative news agency, the oldest and largest in the U.S. and long the largest in the world. Alcoa Inc., the world's largest maker of aluminum, reached agreement Thursday to acquire No. 3 Reynolds Metals Reynolds Metals Company (RMC) was the second largest aluminum company in the United States, and the third largest in the world. The company became well-known for the consumer product Reynolds Wrap as well as being a leader in developing and promoting new uses for aluminum; Inc. for more than $4 billion. But the deal disappointed Wall Street because it was only slightly better than Alcoa's initial hostile bid. Shares of both companies tumbled, reducing the value of the all-stock transaction to $4.34 billion from $4.45 billion. Alcoa's initial bid, made Aug. 11, was $4.2 billion. Reynolds accepted the unsolicited un·so·lic·it·ed adj. Not looked for or requested; unsought: an unsolicited manuscript; unsolicited opinions. unsolicited Adjective deal over one with Michigan Avenue Partners, a little-known Chicago investment group, after Alcoa threatened to take its bid directly to Reynolds shareholders. But Reynolds also won a concession from Alcoa that gives it 30 days to solicit a better offer, and Michigan Avenue Partners refused to step aside from the bidding. Reynolds agreed to be acquired for 1.06 shares of Alcoa stock for each of its shares - the equivalent of $70.8875 when the deal was announced. That was at the bottom end of analysts' estimates that Reynolds was worth $70 to $80 a share. By the end of trading Thursday, Alcoa stock had dropped 2.5 percent, reducing the value of the offer to $69.09875 a share. Adding to the confusion, Reynolds would have to pay Alcoa $100 million to get out of the deal if it gets a better offer in the next 30 days, said Alain J. P. Belda Alain J. P. Belda has been the Chairman of the Board and Chief Executive Officer of Alcoa since January 2001. Business experience
Michigan Avenue Partners will continue to pursue Reynolds, 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. Dow Jones Newswires Dow Jones Newswires is the real-time financial news organization owned by Dow Jones. Founded in 1882, its primary competitors are Bloomberg L.P. and Reuters. The company reports more than 420,000 subscribers -- including brokers, traders, analysts and fund managers -- as of July . Michael Lynch Michael Lynch or Mike Lynch may mean or refer to:
The real estate investment group entered the metals industry last year by buying a Reynolds plant in McCook, Ill., and has purchased about $1 billion in aluminum assets in the past 18 months. The group's officials have yet to disclose the terms of their offer but have questioned whether an Alcoa-Reynolds merger will survive an antitrust review. The deal that would create a company with annual sales of $20.5 billion, about 120,000 employees and operations in 36 countries. It would control more than one-sixth of the world's aluminum production. CAPTION(S): 3 Photos, Box Photo: (1--Color) Reynolds Metals Inc. officials Thursday dropped its defense and agreed to accept Alcoa's hostile bid for more than $4 billion. Robert Bukaty/Associated Press (2--Color) Alain J.P. Belda Alcoa CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. (3--Color) Jeremiah J. Sheehan Reynolds CEO Box: ALUMINUM MERGER SOURCES: Hoover's; Companies Associated Press |
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