Harry Hoiles Boosts Offer for Freedom Newspapers

Making his third attempt in two months to take over Freedom Newspapers of Santa Ana, Harry H. Hoiles on Thursday increased his offer by $10 to $108 cash per share, but this time he also included a provision that would let the company buy him out at the same price.

Hoiles and his immediate family own nearly one-third of Freedom’s stock. The latest bid was to be delivered to directors of the company this morning, his lawyers said.

The company, which publishes the Orange County Register and 28 smaller newspapers and also owns four television stations, has rejected Hoiles’ previous offers. Register Publisher R. David Threshie Jr., who is Hoiles’ nephew, said he had not yet seen the offer and could not comment. But he reiterated previous company statements indicating that the majority shareholders would not sell to Hoiles at any price.

According to Peter Kent, an investment banker with Henry Ansbacher Inc. of New York, the latest bid represents Harry Hoiles’ “final offer.” If it is rejected, Kent said, Hoiles will seek to sell his stake to outside investors, something he has threatened to do for five years.

The offer comes as part of the continuing feud between Hoiles and the families of his sister, Mary Jane Hoiles Hardie, and his late brother, Clarence H. Hoiles. A lawsuit that Harry Hoiles brought in April, 1982, to dissolve the company is scheduled for trial Jan. 20 in Orange County Superior Court.

Among a number of other lawsuits pending is one filed filed Sept. 30 by the heirs of Clarence Hoiles, alleging that Harry Hoiles mismanaged a trust, the major asset of which is company stock. Two other suits allege that Clarence Hoiles mismanaged the same trust.

The latest offer puts a value on the company of more than $1 billion, two-thirds of which Hoiles proposes to pay for in loans that would be paid back from the company’s cash flow and, possibly, the sale of some assets.

The offer also includes a provision for the other branches of founder R. C. Hoiles’ family to spin off any properties they wish before the sale as long as they do not take more than two-thirds of the assets, said Hoiles lawyer, Marion C. Fay. The payoff price would be reduced accordingly, she said.

If the majority shareholders do not want to sell out, according to the offer, they may purchase the Hoiles family shares at the same price, which would amount to $331 million. Four years ago, the majority families offered to buy out Harry Hoiles for $74 million.

The latest round of buy-out offers began Aug. 29 when Harry Hoiles offered $96 a share for the remaining stock. A second offer of $98 a share was made Sept. 30.