A New Jersey food company has bought a 43.3% stake in ICEE-USA for $3.4 million as part of its plan to gain control of the Anaheim maker and marketer of the popular ICEE brand flavored slush drinks.
J&J; Snack Foods Investment Corp., a wholly owned subsidiary of J&J; Snack Foods Corp., bought out ICEE's major shareholder and board chairman, A. Walter Rognlien, according to a public report filed Monday with the Securities and Exchange Commission.
Rognlien and his Runglin Co. Inc., a Los Angeles investment company he named after the phonetic pronunciation of his name, sold their 593,455 shares, or 38% of the stock, to J&J; for $5 a share on May 11.
J&J;, headquartered in Pennsauken, N.J., near Philadelphia, had purchased 82,800 shares on the open market on May 7 and 8 at $5.50 to $5.625 a share.
Rognlien, 75, was not available Tuesday to explain why he sold out. Through his investment firm, he owns some or most of nearly a dozen companies, one of his lawyers said.
Officials at ICEE and at J&J; also could not be reached for comment. All reportedly were at a board meeting late Tuesday afternoon.
'Intends to Acquire Control'
In the SEC filing, J&J; said it "intends to acquire control" of ICEE, though it has not formulated any specific plan and could not give any timetable for achieving such control.
J&J; said it would attempt to gain control of the board by vote of directors, by vote of shareholders or by purchase of more shares.
J&J;'s parent company, with 240 employees and sales of up to $20 million a year, makes frozen pretzels, frozen juice bars, frozen Hispanic specialty pastry and whipped fruit drinks. It also supplies merchandising equipment. It has a net worth of more than $12 million, according to the SEC filing.
Early this year, ICEE contracted with Coca Cola USA to buy Coke and Fanta brand syrups to add to the list of carbonated flavorings it uses in its frozen slush drinks at about 1,660 ICEE outlets, mainly in discount stores in the western United States, and in Canada and Mexico.
Last year, ICEE reported a $205,000 net loss on $14.6 million in sales, compared to the previous year's $231,000 net income on $13.2 million in sales.
The 19-year-old company raised $3.2 million in an initial public stock offering 2 1/2 years ago.