Both EGL suitors increase offers
EGL Inc., the parent company of Houston-based freight forwarder Eagle Global Logistics, said that two groups waging a bidding war for the company have increased their offers.
On Friday, a group led by James R. Crane, EGL’s largest shareholder, chief executive officer and chairman, increased its offer to holders of EGL common stock to $45 per share in cash.
Then on Saturday, CEVA Group Plc, a U.K. public company owned by affiliates of New York-based Apollo Management, increased its offer to $46 per share, or about $1.87 billion.
The battle for the company began last week when CEVA offered $43 cash per share, topping an original $38-per-share merger deal with a group led by Crane. The Crane consortium’s offer is worth $1.84 billion.
On Sunday, a special committee of EGL’s board of directors determined that the revised proposal from the CEVA group is a superior proposal to the latest one from the Crane group as defined in the merger agreement.
While at this time the current merger agreement with the Crane group remains in effect, the special committee said it had notified the Crane group of its determination and its availability to discuss and negotiate any revised proposal that the Crane group wishes to make during the period provided by the agreement, which ends on Wednesday.
The company said its current agreement with the Crane group may be terminated under certain circumstances, including if the board or special committee has determined in good faith that it has received a superior proposal and otherwise complies with certain terms of the agreement, including the payment by EGL of a $30 million termination fee.
Both groups plan to take EGL private.
EGL stock closed at $42.71 per share on Friday. EGL’s stock fell to $29.06 on Dec. 26 from a July 2006 high of $51.64 after poor quarterly results and an overbilling scandal involving Defense Department work. Since February, when Crane and his original investment partners made their initial offer for EGL, the company’s stock price has rapidly increased from $30.82 per share.