After an initial snub, chemicals maker A. Schulman reinstated its offer to purchase Ferro Corp for US$563 million. The move is said to increase its ability to control prices in light of weak market demand. Ferro for its part has rebuffed the offer, saying that it is better off doing its own work.
As a result, Ferro's shares increased by 33% to US$6.90 per share, well above the initial offer of US$6.50 per share. Schulman is now recalculating its offer after review of Ferro's books.
Schulman had initially expressed intent to purchase Ferro through a letter sent last February 13 but the bid was refused. Ferro then reassured its shareholders that no action need be taken, after advice was provided by Goldman Sachs for finance and Jones Day for legal.
The new offer comprised of US$6.50 per share with a 25% premium totaling US$855 million including a debt swap. The payment would be US$3.25 cash while the rest would be paid in shares.
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