RB Industries Approves $48.5-Million Buyout Bid

RB Industries, which operates a chain of furniture showrooms, Monday accepted a $48.5-million takeover bid by an investment group headed by the former president of a rival furniture store chain.

The agreement comes less than a month after Irvine-based RB accepted a $46-million takeover bid by a group formed by Montgomery Securities of San Francisco. In its announcement Monday, RB said it had terminated the merger agreement with the Montgomery Securities group because the new offer topped Montgomery’s.

Under the terms of the new agreement, the investment group--RBI Acquisition Corp.--will pay $12.50 in cash for each RB share. The stock closed Monday in New York Stock Exchange trading at $11.875, up $1.125.

Before the merger is made final, RB will elect four nominees of the group to its board, according to the agreement.

RBI Acquisition Corp, which must still line up financing for the deal, is headed by Michael H. Solomon, 40, who was president of the Fountain Valley-based Krause’s Sofa Factory chain. Solomon will become president of RB once the takeover is completed.

Solomon, who has also worked as a marketing executive at various consumer product firms, was not available for comment.

His investment group has already purchased 1.2 million shares--nearly 34% of RB--from Australian investor Solomon Lew, who had sought to win control of the entire company.

To guarantee a bonus to shareholders even if the acquisition fails, RB has agreed to sell its real estate holdings and other assets in order to pay stockholders $12.50 for each RB share, the company said. The acquisition is expected to be completed early next year.

Founded in 1950 with a store on Western Avenue in Los Angeles, RB now runs 51 furniture showrooms. For the year ended June 30, RB reported a loss of $4.7 million on sales of $99.6 million.