Swift Transportation officials rejected the proposal of its largest shareholder, Jerry Moyes, to acquire all of the company’s outstanding common stock in an all-cash transaction at a price of $29 per share.
The decision was made official Nov. 27 by a special committee comprised of members of the company’s board of directors.
After careful review, and based in part on the advice and analysis of its financial advisor, Goldman, Sachs & Co., the committee determined that Moyes proposed price of $29 per share is inadequate.
But the deal isn’t officially dead. The committee members continue to look at ways to maximize value for company shareholders and, with the assistance of its financial advisor, will commence discussions with Moyes and his financial advisor to determine if the proposed price can be increased to “adequately reflect the full value of the company.”
And, that’s not out of the realm of possibility.
In the letter Moyes made his buyout offer in, he said that he believed $29 per share was a fair price to offer, given that it was 21 percent per share over the stock’s trading price the day before he made his offer.
But, he left the door open for further negotiations.
“I am prepared to consider any factors that you believe justify a higher purchase price, and, upon the completion of due diligence, I may be willing to increase my proposed price,” he wrote in his letter to Swift officials.
Moyes, however, apparently isn’t the only investor eyeballing Swift for possible purchase. Because, according to the press release, the committee of Swift officials and the company’s financial advisor has begun discussions with other potential financial and strategic buyers for the company.
As far as a timetable for all of these negotiations, the committee members are acting “expeditiously, but there is no timetable for its discussions with Mr. Moyes and other parties.”
According to a Nov. 6 Securities and Exchange Filing by Moyes, he owns 27.1 percent of the outstanding shares of Swift stock.
Moyes paid $1.25 million in September 2005 to settle a case accusing him of insider trading. He had purchased nearly 190,000 shares of Swift stock just before the company reported better-than-expected earnings.
Moyes stepped down as chairman and CEO in October 2005.