Point 4 Gives Up Move to Acquire Alpha Micro
Point 4 Data Corp. conceded defeat Wednesday in its bid to acquire Alpha Microsystems, terminating its 3-week-old tender offer for 49.9% of the Santa Ana computer-maker’s stock in the face of a higher bid from a new suitor.
Officers of Tustin-based Point 4 decided they did not want to get into a bidding war, said William F. Rigby, the company’s president and chief executive.
“We took a good look at Alpha Microsystems and came to the conclusion that the price we offered was fair and appropriate,” he said.
Alpha Micro’s directors on Monday voted to approve an agreement-in-principle to merge the company with TeleVideo Systems Inc. of Sunnyvale, which has offered $8 per share--a total of $25.5 million--for all of Alpha Micro’s stock.
While Rigby said Point 4 does not intend to engage in a bidding war, he left open the door for a future bid if the Alpha Micro-TeleVideo agreement falls through.
Meantime, Point 4 said it will mail back the shares already tendered by some Alpha Micro stockholders. Rigby said he does not know how many shares actually have been tendered.
Offer Made Sept. 2
Point 4 made its tender offer on Sept. 2--the same day Alpha Micro’s co-founders and largest stockholders--Richard Wilcox and Robert Hitchcock--threatened to launch a proxy fight to unseat the company’s current management. On Aug. 29, Alpha Micro’s board had removed Wilcox as chairman and Hitchcock as vice chairman, apparently because of the pair’s opposition to any merger.
Wilcox and Hitchcock, who remain as directors of the company and who each own 12.6% of Alpha Micro’s stock, had “violent disagreements” with officers and other directors over corporate strategy, according to their lawyer, Harry L. Hathaway of Los Angeles.
A big part of those disagreements involved the founders’ opposition to any merger. The company had several informal discussions with Point 4 about a possible acquisition before Point 4 initiated its unsolicited $9.5-million tender offer.
Both Wilcox and Hitchcock, however, voted with other directors over the weekend to recommend sale of the company to TeleVideo, and they will probably settle “minor details” later, Hathaway has said.
The co-founders apparently were not satisfied with Point 4’s offer to pay $6 a share for the first 49.9% of the stock tendered and to pay remaining shareholders in three-year subordinated notes worth $5.50 per share. The notes would accrue interest at 8% per year until they were paid off.
TeleVideo is offering all stockholders $4 cash plus $4 worth of TeleVideo stock for each share of Alpha Micro. Wilcox and Hitchcock are satisfied with the $8-a-share price, Hathaway has said.
TeleVideo said Monday that it plans to operate Alpha Micro as a wholly owned subsidiary and that current management “is expected to remain intact.” The companies should complete the transaction by the end of the year, said Dennis Trombley, an Alpha Micro spokesman.
