Maytag Corp. says new bid causes ripples

Maytag Corp. says new bid causes ripples
 
Date June 30, 2005
Section(s) Local News
Brief  
 
By DAVID PITT

AP Business Writer

DES MOINES — Household appliance maker Maytag Corp. said today it was notified by Triton Acquisition Holding Co. that Maytag‘s talks with rival suitors give Triton the right to terminate their merger agreement and collect a $40 million termination fee.

Triton is an entity organized by an investor group led by New York investment firm Ripplewood Holdings LLC. Maytag agreed a month ago to be acquired by Ripplewood, but on June 20 said it was considering a preliminary $1.28 billion bid from Bain Capital, Blackstone Group and China’s Haier America that values Maytag at $16 per share, $2 more per share than the offer from Ripplewood.

Maytag shares fell 5 cents to $15.81 in early trading Thursday on the New York Stock Exchange.

A Maytag statement released Thursday said Triton officials have told Maytag that continued discussions with Bain, Blackstone and Haier America are “resulting in disruption and uncertainty that is damaging to Triton and, in Triton Acquisition Holding’s view, is likely to be damaging to the company.”

Triton said since Maytag has continued to talk with the Haier America group beyond June 18, Triton has the right to end the merger agreement and receive a $40 million termination fee.

June 18 marked the end of the official solicitation period, during which Maytag could share internal information with other potential bidders.

Since the company has continued to provide information with the Haier group after that date, Triton is saying it can legitimately back out of the deal, said industry analyst Laura Champine, of Tennessee-based Morgan Keegan & Co.

Triton further advised Maytag to bring the process to a rapid conclusion, and said it will continue to monitor progress.

In a statement, Maytag said it believes the merger agreement gives the company the right to engage in talks with Bain, Blackstone and Haier America about their $1.28 billion bid, and that doing so does not give Triton Acquisition Holding a termination right.

Maytag said it will pursue its process with Bain, Blackstone and Haier America as “expeditiously as practicable.”

Maytag spokesman John Daggett declined to comment further.

“We can’t comment on anything because of the fact that we’re in this sensitive time,” he said.

Champine said the communication from Triton is likely an attempt to put Maytag on notice that they can back out of the agreement if they want and a decision needs to be made quickly.

“What’s interesting, and it may or may not mean anything, is that the first communique from Triton is not upping the bid, it’s saying ‘By the way, we can cancel this if we wish,'” Champine said.

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