Dataproducts to Be Sold for $160 Million
Two members of Japan’s Hitachi Group said Monday that they agreed to buy Dataproducts Corp. for about $160 million in cash, about three months after a New York investor group abandoned a bid for the Woodland Hills computer-printer maker because it could not raise the money.
The two companies, Hitachi Koki and Nissei Sangyo, will form a joint venture corporation that plans to acquire Dataproducts through a $10-a-share tender offer. Hitachi Koki--which is 24% owned by Hitachi Ltd., a large Japanese electronics company--makes power tools and scientific instruments, as well as computer printers. Nissei Sangyo, a trading company owned 57% by Hitachi, is the Hitachi Group’s primary marketing arm.
Dataproducts stock closed Monday at $9.625 a share, up $3.25 in trading on the American Stock Exchange.
The proposed merger, approved by Dataproducts’ directors, should give the company some long-sought stability, said Dataproducts Chairman Jack C. Davis, who will stay on as chief executive of the new company.
“Now we’re able to focus on the business and not have to worry about some other outside disruption,” Davis said.
Under pressure from the earlier takeover bid by DPC Acquisition Corp., Dataproducts last year embarked on a restructuring that led to the layoff of nearly 11% of its workers and the sale of its headquarters property to raise cash for a $40-million stock buyback.
Davis said the Japanese companies and Dataproducts had discussed selling Dataproducts’ New England subsidiary, which makes printers for the military. Dataproducts had planned to sell the unit last year in the restructuring but abandoned the attempt because of the slowdown in defense spending.
Davis said that otherwise, “our first premise is to continue operating the way we are.”
In January, DPC announced that it could not raise enough money to finance its proposed $190-million, $10-per-share takeover of Dataproducts, blaming “current disarray in the financial markets.” The DPC deal was to be partly financed by junk bonds, as well as bank loans and cash.
