Golden West Expected to Reject Lyon Purchase Offer

Though the players remained silent Thursday, Wall Street seems to be betting that Golden West Homes will not agree today to sell out to William Lyon--in a deal valued at less than its stock is now selling for on the open market.

News that Lyon was readying an offer to purchase 73.1% of the company for $9.3 million apparently was leaked to Wall Street on Wednesday, where it caused Golden West’s stock to shoot up to $4.50 a share--up $1.25 for the day--on the American Exchange.

Although the stock slid back to $4 a share by the close of trading Thursday, the issue is still going for 25 cents per share more than Lyon offered to pay for each of the 2.4 million shares of Golden West that his company doesn’t already own.

A special committee of Golden West directors has been created to consider the offer and is expected to give the retired general an answer to his proposal to merge Golden West with the Newport Beach-based William Lyon Co., Southern California’s largest home builder.

During fiscal 1985, which ended May 25, Golden West lost $9.3 million on revenues of $58.7 million. However, during the first quarter the company managed to post earnings of $166,000 on revenues of $18 million.