USANA’s bid to go private is OVER. Gull Holdings, the group led by Myron Wentz, the founder of USANA announced that they are terminating their offer to purchase the outstanding shares and take the company private.
After losing a battle Monday that halted the bid from moving ahead, Gull was essentially forced to terminate their plans. In addition to the latest loss in court, the offer has been rejected by a specially appointed committee as well as many of the minority shareholders. It became clear to Gull and Wentz that they would not be able to secure the 90% percent of USANA shares needed to complete the offer.
Wall Street had a negative reaction to the news sending the stock down almost 13% to $24.43 in a much higher than trading day.
Gull and Wentz made the original offer of $26 dollars on May 13 and then raised it to $28 dollars on June 30th after the initial offer was rejected. Unfortunately the latter offer did not satisfy minority shareholders or the USANA board.
We have been following this story extensively and have always felt that while the intentions were good, the process in which Wentz and Gull went about the deal was poorly executed. Aside from the original bid being way too low, the ensuing lawsuits and standing by the offer even after the independent counsel rejected it made no sense at all. It also ddidnt help Wentz/Gull that economic conditions have only gotten worse since the original offer. Now, hopefully, Wentz can go back to spending time running the company and building even greater shareholder value. Somewhere in the background you can almost hear Barry Minkow gearing up for another assault on the company.
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