Greetings card publisher American Greetings Corp. has announced that its founders the Weiss Family will take the company private again by purchasing outstanding shares in the company in a deal worth $878 million. The firm will be led by Chairman Morry Weiss, director and Chief Executive Zev Weiss and director, president and chief operating officer Jeffrey Weiss.
All American Greetings’ Class A and Class B shareholders, excluding the Weiss family and related parties, will be paid between $18.20 and $18.35 per share in cash, plus one regular quarterly dividend of $0.15 per share. The price is a significant increase on the initial offer of $17.18 per share put forward by the Weiss family in September 2012, which prompted several minority shareholders to announce their intention to sue American Greetings for what they considered to be an unfair bid.
American Greetings’ press release on the acquisition said that it will be financed via: “a combination of the contributions of the American Greetings shares owned by the Weiss Family, cash funded by a $240 million non-voting preferred stock investment committed by Koch AG Investment, LLC, a subsidiary of Koch Industries Inc., and $600 million in committed debt financing, consisting of a $400 million term loan and a $200 million revolving credit facility, and cash on hand. “
The new deal will be financed via contributions of the American Greetings’ shares already owned by the Weiss family and $600 million in committed debt financing.
American Greetings was formed over 100 years ago in Cleveland by Jacob Sapirstein and went public in 1958. Members of the founding Weiss family have comprised a large part of its senior management throughout the company’s history. In making their bid the Weiss brothers said that taking the company private will allow American Greetings to “return to its roots,” and they are confident of securing financing.
American Greetings, which has annual revenues of around $1.7 billion, is the second largest greetings card publisher in the USA, following global giant Hallmark Cards. American Greetings trades in the UK as UK Greetings.