Tentative Agreement With Parker Is Announced
After a brief collapse in talks last week, a firm that makes fuel-cleaning systems for cars announced a tentative agreement to sell its controlling interest to a Dallas company. The size of the transaction was not disclosed.
In a statement, Parker Automotive Corp. said “lengthy and arduous negotiations” on Saturday had resolved differences between company founder Michael E. Parker and representatives of the Remington Cos., a Texas holding company that now owns several financial services, real estate and oil exploration firms.
The deal is aimed at giving Parker Automotive a quick infusion of cash at a time when it has been slowed by legal and fiscal troubles. For the quarter ending last Nov. 30, the company lost $2.9 million on sales of $568,000.
The company’s statement Sunday said the terms of the agreement reached over the weekend “include an immediate and substantial cash infusion into the company” and more funds in the future if necessary.
Parker’s future relationship with the company had been a sticking point in talks. It could not be determined Sunday if Parker would remain with the company as chairman and director.
The company statement said Remington would have an option to buy all shares owned by Parker, his immediate family and two children’s trusts at $6.50 a share any time within the next three years.
If the option is exercised, Parker and his family could received $14.3 million for their stock.
Parker resigned as president and chief executive officer last fall after Parker Automotive was placed in temporary receivership by a federal bankruptcy court judge. The receivership was ordered after creditors of Parker North America Corp., another company founded by Michael Parker, charged that funds from PNA were funneled to Parker Automotive. Parker denied the allegations, and the receivership was subsequently lifted.
Officials with Parker Automotive and Remington could not be reached for comment Sunday. The Parker company statement said it expects the deal to close this morning, with Remington officials issuing a statement of their own after that.
