Gradco Systems Inc., an Irvine-based manufacturer of paper sorters, has filed for Securities and Exchange Commission approval to complete its acquisition of Ziyad Inc., a New Jersey-based paper feeder manufacturer.
Under an agreement between the two companies, each Ziyad shareholder will have three options in the merger, said Robert Eastty, Ziyad corporate controller: to receive approximately $4 in cash for each share of Ziyad common stock, to exchange Ziyad stock for Gradco stock at a rate of $4 worth of Gradco for each Ziyad share, or to receive a combination of $2.48 in cash and $1.52 worth of Gradco common stock for each share of Ziyad.
Gradco corporate secretary Newton Lee would not comment on how the $4 value of Ziyad shares was determined. The stock closed Wednesday at $3.56 per share.
Gradco common stock closed in over-the-counter trading at $9.25 per share, up 1/8-cent a share.
Gradco agreed to acquire Ziyad in December for about $22.4 million. Eastty said the merger should be completed by May 1.
Gradco Systems Inc. reported a net loss of $894,450 for its fiscal 1987 third quarter ending Dec. 31, compared with net income of $1.3 million a year earlier. Gradco posted net earnings of $2 million for its fiscal 1986. Ziyad has a net worth of about $28 million.