Quotron Systems, apparently unable to find a higher bidder, said late Tuesday that it would not actively oppose Citicorp's $680-million tender offer even though it continued to call inadequate the $19-per-share bid.
In a brief statement released after a board meeting, the Los Angeles-based provider of electronic stock quotations and other financial information said it tried again but failed to persuade the New York-based banking firm to increase its offer.
Quotron Chairman Milton E. Mohr said that although his firm's board believes the price is inadequate, "it would not be in the shareholders' interest for the company to take actions which might prevent the Quotron shareholders from making their own determinations as to the adequacy of the offer and the desirability of tendering their stock for $19 a share."
A Citicorp spokesman said the firm would have no comment until today.
A Quotron decision not to oppose Citicorp was likely to guarantee that the offer would succeed, barring a 11th-hour bid by another party, analysts have said.
Earlier Bid Rejected
Citicorp, the nation's largest banking firm, wants Quotron as part of an ambitious expansion effort in information services. The banking firm began its tender offer for all of Quotron's stock last Thursday, after Quotron had rejected outright Citicorp's proposal in March to merge for the same $19-per-share price.
In rejecting the earlier bid, Quotron had said it would continue to consider "various courses of action to maximize shareholder values," including finding another suitor. But apparently the firm was unable to secure a higher bid.
Much of Quotron's stock reportedly is now owned by professional arbitrageurs who bought shares seeking a quick profit from selling to the highest bidder. Barring a new bid or some other twist, those arbitrageurs may have little alternative but to sell to Citicorp.
Quotron stock closed at $18.875 per share in active over-the-counter trading Tuesday, unchanged from Friday's close.
Quotron's new position also is likely to reduce any legal liabilities against Quotron's directors. Had they decided to oppose Citicorp's offer, they may have subjected themselves to shareholder lawsuits, analysts have said.