Group raises takeover offer for American Greetings
NEW YORK (AP) — Shares of American Greetings climbed more than 7 percent Friday as a group led by some of the company's top executives increased their bid to take the greeting card and gift seller private.
THE SPARK: On Thursday members of the Weiss family, including American Greetings CEO Zev Weiss and his brother, President and Chief Operating Officer Jeffrey Weiss, along with other investors and executives, raised their takeover offer for the stock they don't already own to $17.50 from $17.18 per share.
The revised offer, which was disclosed in a regulatory filing, is a 7 percent premium to the Cleveland company's Wednesday closing price of $16.30.
The new bid values the entire company at about $578.9 million. The company currently has about 33.1 million outstanding shares, according to FactSet.
The group's initial offer valued American Greetings at approximately $581 million, when the company had more shares outstanding.
THE BIG PICTURE: The group including the Weiss brothers submitted their initial acquisition proposal to American Greeting's board in September.
In its regulatory filing on Thursday, the group said that it has commitments of more than $700 million in bank financing for the proposed transaction and believes the remaining financing needed for the deal "will be available to us in the near future."
The group said it does not plan to raise its bid further.
Last month American Greetings reported a fiscal third-quarter loss because of costs related to its Clinton Cards stores, which it purchased out of bankruptcy in June. Revenue increased 9 percent for the period.
Aside from its namesake cards, American Greetings' brands include Carlton Cards, Recycled Paper Greetings and Papyrus.
SHARE ACTION: American Greetings Corp.'s stock rose $1.12, or 7.2 percent, to $16.60 in morning trading. Over the past year, the stock has traded between $12.53 and $17.49.