Newport Electronics Says Other Acquisition Offers Are Welcome

Newport Electronics Chairman Barret B. Weekes said Friday that his board of directors has told him to welcome talks with other potential buyers for the company in the wake of an unsolicited acquisition inquiry from Sensor Control Corp. in Sunnyvale.

He said, however, that there are now no other suitors for Newport, a Santa Ana company that makes precision digital instruments.

Sensor proposed Thursday that Newport enter into negotiations to sell its stock to the Sunnyvale electronic instruments company for $8 a share, or $9 million.

Weekes said he has met Sensor officials three times in recent months and that they “hinted of their interest” in Newport but had not proposed anything until Thursday.

Sensor officials could not be reached for comment Friday.

Weekes said that Sensor, which is about one-third the size of Newport, had $3.7 million in cash on its books as of June 30. That sum represents proceeds of the company’s initial public offering in February, 1987.

That cash apparently would be used as leverage to obtain financing for Sensor’s $9-million cash offer if the deal is concluded.

Newport has 170 employees and expects to have about $16 million in sales this year, about half in its overseas market. For the first 9 months, Newport reported a profit of $499,000 on $13 million in sales.

Sensor, which has 45 employees, reported a profit of $529,000 on sales of $5 million for its 1988 fiscal year, which ended June 30.

Weekes said that Newport and Sensor are not competitors but rather that they produce “complementary” product lines.

He said he knows of no particular reason for Sensor to propose the acquisition “other than that we’re an established company with a reasonably good track record. But there’s no exciting new product hiding in the bushes that they have found out about.”

Word of the proposal, which was released after the markets closed Thursday, excited interest in Newport stock Friday, driving the closing price to a 52-week high of $7.25 a share in over-the-counter trading, up $2.625 or 56.8% for the day.

Sensor’s stock also rose, closing on the over-the-counter market at $3 a share, up 50 cents or 20% for the day.