Intergroup Board Rejects Leucadia Bid : Says $750-Million Merger Offer Highly Conditional

Directors of National Intergroup on Friday rejected a $750-million merger proposal from Leucadia National, the largest single investor in the diversified metals and consumer finance company.

National Intergroup’s directors, in a printed statement, said that Leucadia’s offer was highly conditional and that it is not an appropriate time to sell the company.

Leucadia said it was disappointed by the rejection. The New York life insurance and consumer finance company failed in March to block shareholder approval of a merger between National Intergroup and Los Angeles-based Bergen-Brunswig, a prescription drug distributor. Bergen-Brunswig later pulled out of the deal.

Leucadia also lost its bid in June for four board seats that it sought as part of a plan to sell Pittsburgh-based National Intergroup’s assets and distribute the proceeds to shareholders.

Most recently, Leucadia offered to buy the 91% of National Intergroup that it does not already own for $35 a share, or about $750 million.

Leucadia originally conditioned its offer on National Intergroup’s agreement to complete plans to sell its majority interest in First Nationwide Financial to Ford Motor for about $400 million. That transaction is awaiting regulatory approval.

Leucadia also wanted to scuttle National Intergroup’s plan to buy Permian Corp., a petroleum distributor, for about $172 million.

On Friday, National Intergroup said it was continuing its review of a financial restructuring and other programs for the “enhancement of stockholder value.”

Later, Leucadia noted in a statement that its $35-per-share offer was not rejected as inadequate and “called upon the board to specify its plans to enhance shareholder value.”