Industrias Romi S.A. reports it $10/share cash tender offer has garnered 38% of the outstanding shares of its target Hardinge Inc., and is extending the offer period for three more weeks.
Romi CEO Livaldo Aguiar dos Santos said the tender results together with a recent withhold vote against Hardinge director nominees at its annual meeting are “a clear indication that a large number of shareholders want Hardinge to dismantle its aggressive takeover defenses and negotiate a transaction with Romi.”
In a statement, Hardinge responded: “It is unfortunate that Romi has decided to continue to pursue its opportunistic hostile bid for Hardinge even in the face of a clear indication from Hardinge’s shareholders that they agree with our board, which unanimously determined that Romi’s ‘best and final’ offer is highly inadequate and not in the best interests of the company and its shareholders.”
The Brazilian machine tools manufacturer began its pursuit of Harding last October with an approach to that company’s directors, but it was rebuffed. On February 4 it made a public, all-cash offer at $8/share for all outstanding shares, but again the board demurred.
Romi took its $8/share bid to the shareholders in late March, and then raised the bid to $10/share on May 10. The company has said this is its final bid. The cash-tender offer is now set to expire on June 18.
Harding is urging shareholders to reject the offer, and has argued that its ongoing restructuring is succeeding at preparing the group to benefit from a recovery in the manufacturing sector.
Hardinge, of Elmira, NY, produces vertical and horizontal machining centers, CNC lathes, grinding tools, and workholding equipment. Its brands include the Hardinge, Kellenberger, Bridgeport, Hauser, and Tschudin product lines.
Romi manufactures machine tools, plastic injection, and blow molding machines, and also produces component parts made of gray and ductile iron. Throughout the process it has argued that combining its assets with those of Hardinge will form an organization that is better suited to compete in the global machine tool market.
“Given the ongoing consolidation in the machine tools industry and the significant competitive pressures facing Hardinge, we continue to believe that a transaction with Romi, which would provide Hardinge shareholders immediate liquidity at superior value, is the best strategic alternative available to Hardinge,” Santos stated.