Offer Made For General Refractories

Posted: June 16, 1988

Raymond G. Perelman, chairman of General Refractories Inc., yesterday offered to purchase the company through another firm he controls, Belmont Industries.

Philadelphia-based Belmont already controls 47.6 percent of General Refractories' 3.5 million outstanding shares. The firm offered to pay $20.50 a share, or about $37 million, to acquire the remaining shares.

General Refractories' stock closed yesterday at $21.75 a share on the New York Stock Exchange, up $4.375 from the previous day's trading.

Perelman said yesterday that Belmont Industries had been seeking an acquisition for some time but that the company decided that its money was best spent by taking General Refractories private.

"We looked at a lot of companies and we've decided that what we were looking at wasn't as good as what we already had," Perelman said in an interview.

General Refractories, based in Bala Cynwyd, is a diversified mineral- resource company engaged in the sale of furnace bricks and mineral products. In 1987, the firm earned $42.9 million on sales of $209.28 million.

Belmont Industries is a diversified holding company whose wholly owned subsidiaries manufacture products ranging from dental supplies to gardening equipment.

Yesterday's proposal calls for a merger between General Refractories and Belmont or one of its wholly owned subsidiaries. The offer is scheduled to expire on June 24.

General Refractories' board has established a committee of independent directors to study the proposal and negotiate on behalf of the company. The committee also has been authorized to hire an investment banking firm to help in determining the fairness of the offer. Perelman will not participate in the board's consideration of the Belmont offer.

General Refractories' board also voted yesterday not to adopt certain anti- takeover protections recently approved by the state legislature for Pennsylvania-based corporations.

Perelman yesterday declined to make a prediction on whether General Refractories' board would vote to accept his offer.

"I think they're going through the necessary steps which they have to do to see to it that the stockholders get the best value," he said.

General Refractories has been engaged in a protracted effort to acquire Champion Parts Rebuilders Inc. of Illinois. Champion spurned the offer, and General Refractories filed suit against the firm. The suit is pending.

Perelman said yesterday that the Champion deal remains stalled and that the ultimate resolution of the deal would be unaffected by a Belmont takeover.

"Whether I cut it (the deal with Champion) or not depends on what the Champion people want to do," he said.

comments powered by Disqus