Kenner Parker Discloses Takeover Talks

Kenner Parker Toys, resisting a hostile $489-million takeover bid by New World Entertainment of Los Angeles, said Thursday that it is holding preliminary talks with other suitors and is considering a recapitalization plan.

Beverly, Mass.-based Kenner Parker, in a filing with the Securities and Exchange Commission, said it was considering the actions “with a view toward maximizing value for the company’s shareholders.”

New World is offering $47 per share for the 91.6% of Kenner Parker’s 11.4 million shares it doesn’t already own.

When New World began its pursuit of Kenner Parker last month, it was offering $41 per share.

Kenner Parker’s stock closed Thursday at $50 per share, up 62.5 cents, indicating that investors expect the bidding to go still higher.

The Massachusetts company, best known for such toys as Care Bears and Play-Doh and board games Monopoly and Clue, declined to identify the parties with which it is discussing a takeover. But it did say it was entering into confidentiality agreements and exchanging non-public information with the companies, indicating that the talks are well advanced.

However, Kenner Parker indicated that it was leaving the door ajar for possible future talks with New World, which was primarily a maker of inexpensive thriller films until last year, when it acquired Marvel Entertainment, a major producer of comic books, cartoons and toys.

Kenner Parker and New World have been battling in court over the constitutionality of a decade-old Massachusetts law that restricts hostile takeovers. To date, Kenner Parker has won a state court injunction blocking New World’s tender offer, while New World has failed to win a court order lifting that injunction.

Kenner Parker said Thursday that the U.S. Court of Appeals for the First Circuit denied a request by New World for an order blocking the state court’s injunction.

The state law was the basis for a preliminary injunction issued earlier this month by a Massachusetts state court temporarily halting the New World offer.

Hearings on the matter are scheduled next month in both state and federal courts.