Lindner Says He May Join the Bidding for Circle K

Cincinnati investor and corporate raider Carl H. Lindner, who controls a 38% stake in Circle K Corp., may join the bidding for the Phoenix-based convenience store chain.

Circle K was unofficially put in play May 19 when Karl Eller, its chairman and chief executive, hired an investment banker and told the board that he may be interested in bidding for the company.

The board responded by saying it would entertain bids for the company and hired its own investment banker, Wasserstein Perella & Co.

In a letter mailed last week to a special committee of the Circle K board, Lindner, the company’s largest shareholder, said he may be interested in participating in a leveraged buyout of the shares he doesn’t already own if the bids being explored by the committee are not acceptable. If they are sufficient, according to the June 27 letter, addressed to Dean P. Guerin, chairman of the special committee, Lindner may decide to sell his entire stake.

Lindner was not available for comment Monday. The letter was made public in a filing with the Securities and Exchange Commission.

Noting his readiness to sell his stake under a lucrative bid, Lindner said he and his company, American Financial Corp., “would also be prepared to discuss possibly participating in a leveraged acquisition of the company, but are not prepared to enter into any agreement with regard to our participation with any bidder until after bids are submitted to the special committee.”

Eller Signs Pact

Lindner holds stock and securities that are convertible into 23 million Circle K common shares, equivalent to a 38% stake. He holds his shares through American Financial, a Cincinnati insurance company. Both he and his son Keith Lindner serve on the Circle K board.

Eller, who holds a 7% stake, signed an agreement with the company June 23 preventing him from increasing his stake above 10% until Aug. 31. The agreement also prevents Eller from soliciting proxies or teaming with other shareholders to deter them from making competing bids.

Eller has hired Sloate, Weisman, Murray & Co., a New York investment banker, to advise him, and has asked Citicorp, the New York banking firm, to explore possible financing for a bid.

Circle K had sales of $2.66 billion in 1988 and employs more than 26,000 people in 4,685 convenience stores in 33 states.