Wickes Sells National Gypsum Stake; Makes $3-Million Profit
Wickes Cos., which made a surprise offer for National Gypsum three weeks ago, said Friday that it sold its stake in the Dallas firm for a $3-million profit. But Wickes did not formally withdraw its tender offer.
The Santa Monica company said it might raise its price if a management buy-out offer, approved by National Gypsum’s board, falls through, which company observers say is unlikely. Thus, the stock sale was interpreted as the end of Wickes’ attempt to buy the home building products company.
Wickes said it sold 300,000 shares--1.3% of National Gypsum’s 22.8 million shares outstanding--at an average price of $68.37 1/2, or a total of $20.5 million. It had acquired the stock on the open market for about $14.89 million. After expenses, including a $1.25-million fee to its investment banker, Drexel Burnham Lambert, Wickes expects to net about $3 million.
Sanford C. Sigoloff, Wickes chairman and chief executive, said the decision was made to sell the stock because it was trading at levels deemed in excess of the ultimate realizable value of the $46 a share cash and $44 face value of subordinated discount notes of the management buy-out offer. National Gypsum shareholders will vote on the offer Tuesday.
He added that National Gypsum shareholders should be thankful to Wickes. “We got them an extra $500 million” more than was in the original management bid.