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The eBearing News
July 14, 2000
General Bearing Going Private via Management LBO
copyright © 2000 eBearing Inc.
General Bearing (West Nyack, New York) majority shareholding Gussack family has taken
several steps in recent weeks to officially take the company private.
In the first step, General Bearing management had General Bearing buy itself out
from management, which owns the holding company.
On July 7, General Bearing announced that it had bought its majority
shareholder, World Machinery Co. World Machinery is a holding company, owned and
operated by General Bearing's board and management, including
board Chairman Seymour Gussack, board members Nina Gussack, several other Gussack
family members and General Bearing's President, David Gussack.
World Machinery's owners (General Bearing board and management) received 3,140,000
shares of General Bearing in exchange for 2,950,000 shares of General Bearing. The
190,000 share difference represents $1.19 million at today's share price.
In the second step, management will use these resources to buy General Bearing.
On July 14, General Bearing's management announced that it had received a tender offer
from General Bearing management to acquire General Bearing for USD 6.50 per share.
General Bearing shares had been trading at $6.25, a P/E of 5.27.
Many industrial companies have been investigating privatization and management buyouts,
given the very low P/E ratios of the past year. Investors, looking to dot-coms and
other areas of the economy, have stayed away from industrial bricks-and-mortar
companies, leaving their stock prices depressed and prime candidates for privatization.
At $6.50 per share, management would be acquiring General Bearing at only
6.77 times trailing earnings.
General Bearing indicates that a special committee of directors will retain an investment
banker to assess the fairness of the transaction to the public shareholders.
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- by Bruce A. Carr
from individual research,
tips and commercial sources.
Unauthorized reproduction is prohibited.
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eBearing.com ... for everything that moves™
Entire contents Copyright 1999-2008, eBearing Inc. All rights reserved.
eBearing.com and "... for everything that moves" are registered
trademarks of eBearing Inc.
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eBearing.com ... for everything that moves™
Entire contents Copyright © 1999-2008, eBearing Inc. All rights reserved.
eBearing.com and "... for everything that moves" are registered trademarks of eBearing Inc.
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