Itel to Buy Stake in American President Cos.

Itel Corp. intends to acquire up to 11.4% of American President Cos. and may seek seats on the Oakland-based holding company’s board, according to a filing with the Securities and Exchange Commission.

Under the terms of a stock purchase agreement with Henley Group Inc., Itel can buy up to 2 million of American President’s common shares from Henley for $827 million and 18.7 million of Itel common shares.

Itel, a Chicago based operator of pay telephones, said it bought the stock as an investment but has held discussions with American President’s management about entering a standstill agreement.

Under this plan, Itel would gain seats on American President’s board in exchange for not buying more than 20% of American President’s common stock. American President would also receive the right of first refusal if Itel were ever to sell some of its company stock.

To complete the stock deal, Itel must receive regulatory approval from the Federal Trade Commission, according to the filing.