National Can Corp. said Tuesday that it has created an Employee Stock Ownership Plan and will make a tender offer for 5.4 million shares of its common stock to block a takeover bid by Florida investor Victor Posner.
National also filed suit in U.S. District Court in Delaware accusing Posner of securities violations and asking for an injunction blocking him from a future takeover bid.
In its new tender offer, which was approved by the board of directors at a meeting Monday night, National Can agreed to pay $40 a share for 5.4 million shares.
Failure of Proposal
On Feb. 5, National Can announced the failure of Posner's proposal for a leveraged buy-out of the Chicago-based corporation, also for $40 a share, an offer with a cash value of about $270 million.
Posner, through a subsidiary of his NVF Co. of Miami, already owns more than 37% of National Can's outstanding common stock.
National Can said its decision was based "in part on Mr. Posner's stated intention to acquire sufficient additional shares to obtain 51% of the company's stock and control of its board of directors."
Following the announcement, Posner said he would continue his attempt to take over the corpora tion, ranked 210th in the Fortune magazine list of the nation's top 500 industrial corporations. Posner made his original offer 11 months earlier.
In a leveraged buy-out, a corporation is bought with borrowed funds, which ultimately are repaid from the company's ensuing earnings.
In its announcement Tuesday, National Can said it is also issuing new preferred stock to dilute Posner's voting percentage to 25.5% from 35.5%.
Posner could not be reached immediately for comment.
National Can said a group of banks led by First National Bank of Chicago has agreed to provide $480 million to finance the tender offer.
The financing is contingent on the ability of National Can and its Employee Stock Ownership Plan to obtain at least 50.1% of the corporation's outstanding voting stock, the company said.
National Can said its financial adviser, Salomon Bros. Inc., said the $40 offer was fair, and the board of directors recommended that stockholders tender their shares.
National Can also said it would accept a takeover bid by a third party if it offered more than $40 a share.
The corporation also named three trustees for the Employee Stock Ownership Plan.
They are John P. Gallagher, former chairman of Chemetron Corp. and currently a lecturer at the University of Chicago graduate school of business; Donald Haider, professor of management at Northwestern University, and Jayne Thompson, wife of Illinois Gov. James R. Thompson and director of development and house counsel of the National College of Education.