To Sell Off 2 Operations : Jacobs Will Take Minstar Private

Irwin L. Jacobs, a corporate raider who hasn’t been doing much raiding since last October’s crash, sought to put his own corporate house in order Thursday, when he announced a plan to take Minstar Inc., the core of his holdings, private.

Jacobs, a Minneapolis financier sometimes criticized for starting moves to buy companies and then selling his stake at a profit, already owns a majority of Minstar’s stock, which is traded over the counter.

The $368-million leveraged buyout calls for an investment group headed by Jacobs to buy back all of the firm’s 12.7 million shares--including the 7.2 million owned by a Jacobs investment group--at $29 per share.

Trading in the stock was suspended during part of Thursday. The stock closed at $26.25, up $2.375.

In an interview, Jacobs said he has been seeking to “increase shareholder value” in Minstar since the crash, when Minstar fell to just over $13 per share.

Jacobs is also selling off two of Minstar’s main operations, in oil and gas field services and golf equipment, and has already found buyers for both. He said the company will be pared to one product line--manufacturing recreational power boats.

Jacobs insisted that Minstar will not be used for future corporate raiding, however. “I have no plans to make this a vehicle to do other transactions,” he said.

Observers familiar with Jacobs say that the financier, who lives on a lake outside Minneapolis, has a strong interest in leisure-time industries, and so may, in fact, want to run Minstar as a boat business rather than as an investment tool.

“Since the crash, I haven’t seen Minstar being used to buy securities,” said David Weber, an analyst with Milwaukee Co., a Milwaukee-based brokerage. “But historically, before the crash, he would do a deal and he would buy some personally, and Minstar would buy some.”

In fact, in Jacobs’ last major raid, on Borg-Warner in late 1986, he bought a stake in Borg-Warner personally, and later Minstar acquired an interest in the Chicago-based conglomerate as well.

Barron’s magazine criticized Jacobs for that deal; in an article published last year the magazine said Jacobs found a way to get a lower price for the Borg-Warner stock he purchased personally than the price paid by Minstar, which presumably was using money from a group of investors put together by Jacobs.

Eventually, Jacobs backed off his raid on Borg-Warner and reaped handsome profits. Jacobs has said his goal was to increase shareholder value.

Last year, Jacobs attempted to restructure Minstar and extract big profits for its investors by merging it with another Jacobs-controlled firm, Genmar Industries. That complex deal would have apparently had Genmar, which actually is Jacob’s boat manufacturer, buy Minstar.

But that initial plan apparently collapsed in the wake of the October market crash, and now Genmar is instead a wholly owned subsidiary of Minstar.

Apart from Minstar, however, Jacobs has been relatively inactive on the corporate scene since the crash, observers say. Barron’s speculated that Jacobs has been liquidating assets and selling off some of his major stock positions since last fall’s market meltdown.