OpTree

Gull Holdings, LTD and Unity Acquisition Corp (Dr. Myron Wentz Family controlled) reaffirmed their offer this morning to purchase the outstanding shares of USANA at $26. This makes no sense considering the independent committee’s announcement last week. Equally as odd is the fact that USANA may be creating a rift between its shareholders and Wentz.

Wentz was also quoted as saying, “I am pleased to see the company’s revenue stabilize given the challenging business environment and the continuing third party allegations affecting public companies within the direct selling industry.”

Why would you make such a statement if a committee just said that you are undervaluing your stock purchase offer? If anything, that statement will only give greater credibility as to why the offer of $26 is not enough. Makes no sense at all. It seems like Wentz’s actions just keep driving the price up! On May 9th the stock was trading at roughly $19 a share. Since Gull Holdings et al made the announcement to take the company public at $26, the stock has climbed over 40%!!

Dr. Wentz, please understand that if you are genuinely serious about taking the company private, continuing to put out good news is only going to drive the price up and make your bid less and less palatable to shareholders. If you want to look at a similar case with a family-controlled public stock and what has happened, go look at Cablevision Systems Corporation. Another example of a company wanting to go private with serious money behind it but increased positive news just drives up valuation and the offer isn’t seen as enough by a special committee.

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