Stanadyne Inc. stock soared in national over-the-counter trading Monday as Emhart Corp. began an unsolicited $580-million tender offer to acquire the manufacturing company.
Stanadyne rocketed $17.25 to $39.50 per share. The company said it would schedule a special board meeting to consider the $40-a-share tender offer begun by Emhart, which last week was rebuffed in a friendly merger attempt.
Emhart, a multinational consumer and industrial products company based in Farmington, offered $40 for each of Stanadyne's 14.5 million outstanding shares. The offer, which is contingent on a majority of shares being tendered, expires Feb. 8.
Stanadyne stated that its board would make a recommendation on the Emhart bid by Jan. 22 and asked shareholders not to make a decision whether to tender their stock until the board made its decision.
Harvey Tattersall, Stanadyne corporate secretary and general counsel, said his company would not comment on the proposal until it was analyzed and considered by the board.
Stanadyne, based in Windsor Locks, Conn., makes automotive products, precision products, ferrous metals and steel bars. Emhart said it was primarily interested in Moen, Stanadyne's plumbing products line.
It said Moen is finishing a fifth record sales year, with projected revenue of $285 million.
If combined with Moen, Emhart's total revenue from its Consumer Products Group would surpass $800 million, approaching the company's long-range objective for consumer revenue of more than $1 billion by 1990, Emhart Chairman and Chief Executive Peter L. Scott said.
Scott said he met Jan. 5 with Gerald R. Bouwkamp, president and chief executive of Stanadyne, to propose a deal. Initially rebuffed, Scott wrote to Bouwkamp on Thursday, outlining Emhart's proposal and asking for further consideration.
The letter did not specify an acquisition price for Stanadyne, except to say that it would be "substantially in excess of the current market price per share and current book value per share."
Emhart spokesman John F. Budd said Sunday that Stanadyne responded to Emhart's letter with a telephone call, again rejecting the offer.
Emhart had 1986 revenue of about $2.4 billion. Combined estimated 1988 revenue resulting from a merger of the two companies would exceed $3 billion, Scott said in the Emhart statement.
Emhart's 31,700 employees manufacture lawn and garden equipment, golf shafts, hardware, staple guns, industrial hardware, electrical products, footwear materials, glass machinery and fastening systems. The company's shares declined 25 cents to $26.625 on the New York Stock Exchange on Monday.