After the Oct. 19 stock market crash, many companies rushed to buy back their stock not only to show confidence in management but to increase the value and the stakes for remaining shareholders.
But Far West Financial, the holding company for Far West Savings & Loan in Newport Beach, has had a tough time shaking stock loose from shareholders. It has repurchased only 129,500 shares of the 1 million shares it set out to acquire on the open market.
Now it has come up with a "Dutch auction" tender offer that it hopes will encourage shareholders to sell at prices above current trading prices yet save the company money that would be spent in a drawn out repurchasing program.
Between now and Jan. 5, shareholders who want to sell all or part of their stock can pick a price between $6 and $10.50 a share that they would sell their stock for. If more than 700,000 shares are offered, the company will determine the price at which it would pick up its quota and pay all shareholders that price. If less than the total amount is offered, the company will pay $10.50 a share.
In the last 12 months, Far West stock reached a high of $17.125 during the summer on the New York Stock Exchange and a low of $6.375 just after Black Monday, according to Charles H. Green, the company's principal financial officer. Stock closed Tuesday at $9 a share.