Harbinger Group Offers To Buy Central Garden & Pet For $10/Share In Cash

(RTTNews) - Harbinger Group Inc. or HRG (HRG) Monday released a letter sent to the Board of Directors of Central Garden & Pet Company or CENT (CENT) on June 16, revealing that it has offered to acquire, directly or through one of its affiliates, all of CENT for $10.00 in cash per share of common stock, Class A common stock and Class B stock. The firm alternatively offers to acquire CENT's Pet Segment for $750 million in cash.

The per share offer represents a 27.5 percent premium over the company's unaffected common stock price of $7.84 at the close of business on June 6, the last trading day before HRG publicly released its previous letter to CENT.

HRG, through a wholly owned subsidiary, is a shareholder of CENT and owns 1.66 million shares of the company's Class A common stock, representing about 4.5 percent of the outstanding shares of Class A common stock.

It also owns 547,048 shares of the company's common stock, representing 4.4 percent of the outstanding shares of common stock.

In the previous letter, HRG said it requested that the CENT Board explore strategic alternatives, including a potential sale of all of the equity of CENT or all or a portion of its assets to HRG or one or more of its affiliates.

HRG said that in addition to its previous letter sent to the CENT Board on June 9, it has repeatedly attempted to communicate with the CENT Board, including offering to meet in person with the Chairman of the Board. The CENT Board and management have been so far unresponsive.

HRG indicated today that it may be able to further increase the value of its current proposals if the CENT Board engages in a constructive dialogue and grants access to customary diligence materials.

Based on reactions of other CENT shareholders in response to its previous letter, HRG believes that there is wide and emphatic support for the CENT Board to engage with HRG and consider its proposals.

HRG believes that the CENT Board should impartially assess HRG's proposal and determine the course of action that is in the best interest of all its stockholders and not only in the best interest of William Brown, the Chairman of the Board and its controlling stockholder.

Accordingly, as a minority shareholder, HRG urged the CENT independent directors to promptly form a special committee of the CENT Board and retain legal and financial advisors who are independent and do not have a long standing relationships with the company or Brown.

In the latest letter, Philip Falcone, CEO of HRG, expressed confidence that with cooperation from CENT, the firm would be able to execute a definitive transaction agreement within 45 days.

HRG closed up 3.3 percent on Friday at $12.96.

CENT, which closed nearly unchanged at $9.00 on Friday, climbed 12.2 percent in pre-market activity.