REVCO $98.2 MIL. BUYOUT OF EX-ODD LOT EXECSBernard
REVCO $98.2 MIL. BUYOUT OF EX-ODD LOT EXECSBernard Marden and Isaac Perlmutter formally ends the potential takeover threat from the two and allows Revco's top management to devote its full efforts to the chain's business. In a July 9 press release, Revco announced that it had purchased 4.4 mil. shares or 12% of its stock at $22.50 per share from former Odd Lot owners Marden and Perlmutter. Issued at the time of Revco's $113 mil. acquisition of Odd Lot in May 1984, the shares were valued at $23.50 on the New York Stock Exchange at the close of business July 8. Commenting on the agreement, which was unanimously approved by the Revco board, Dworkin stated: "We believe the agreement is in the best interests of Revco stockholders. With this matter behind us, Revco management can concentrate fully on operating our business." The release noted that under terms of the deal, Marden and Perlmutter agree not to purchase Revco stock for 10 years and not to enter the business of retailing close-out merchandise. The agreement also provides "certain mutual releases from current litigation." Finally, in return for modifying the original non-competition provision of the merger agreement to permit the two to enter the wholesale distribution business, Revco received at closing a cash payment of $3 mil. The chain indicated that it used its bank lines of credit to finance the $95.2 mil. net cost of the buyout, but that it was "studying long-term financing alternatives."
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