Investor Asher B. Edelman renewed his proposal Wednesday to buy Lucky Stores for $37 a share, but the company responded with a terse reminder that the price had previously been rejected by its board as inadequate.
In a statement, the company added that it plans to proceed Friday with its tender offer to repurchase nearly 14.4 million shares, or 28% of its outstanding common stock, at $40 a share.
Along with the prices of a slew of other takeover targets, Lucky's stock price has been sliding this week. The shares closed down 62.5 cents at $32.125 in trading on the New York Stock Exchange on Wednesday.
Jeffrey Atkin, who follows Lucky for the Seattle money-management firm of Kunath, Karren & Rinne, noted that Edelman has had an opportunity "to buy a reasonable amount of stock at sub-$35 prices. . . . If he's able to get more on the open market at lower prices, he'd have the opportunity to lower his cost per share."
In a filing Monday with the Securities and Exchange Commission, Edelman revealed that he and other investors hold a 5% stake in Lucky, a Dublin, Calif., retailer that is in the process of restructuring.
Atkin reasoned that Edelman might be trying to turn the current turmoil in the financial community to his advantage. The investor reportedly has already lined up financing for the takeover, something that would put him in good stead considering the new skittishness in the high-risk, high-yield bond market.