Bell Industries Sends Response Letter to Coast Distribution System's Board of Directors
February 17 2006 - 9:15AM
Business Wire
Bell Industries, Inc. (AMEX:BI) said today it has sent a letter to
the board of directors of The Coast Distribution System, Inc.
(AMEX:CRV), expressing its desire to meet with members of Coast's
board or Coast's financial advisor to discuss entering into
negotiations to acquire the company. A copy of the letter is set
forth below: -0- *T Bell Letter Dated February 17, 2006 The Coast
Distribution System, Inc. 350 Woodview Avenue Morgan Hill, CA 95037
Attn: Board of Directors Gentlemen: Let us begin by stating that we
were disappointed to learn that a Special Committee of the Board of
Directors of The Coast Distribution System, Inc. (the "Company")
has rejected our proposal. We were also quite surprised, to say the
least, to hear the announcement on February 3, 2006 that the
Company responded to our offer to enter into a negotiated
acquisition by adopting a Shareholder Rights Plan. We do not
believe such a response is constructive or in the best interest of
the Company's stockholders. In our experience, the purpose of a
Shareholder Rights Plan is to protect the Company's stockholders
from unfair or coercive takeover proposals. It appears that the
Board of Directors has misinterpreted our desire to enter into
good-faith discussions regarding a negotiated transaction as a
hostile attempt to takeover the Company. On the contrary, our aim
was and is to negotiate a transaction on a friendly basis. If the
Board of Directors or its financial advisor were willing to meet
with us and engage in a friendly process, we query what need would
there be for the change-in-control protection conferred by a
Shareholder Rights Plan? We believe that the Board of Directors is
thwarting an opportunity for the Company's stockholders to unlock
the full value of their investment. Our good-faith intentions are
evidenced by the fact that we have substantially increased our cash
offer price and have expressed our willingness to shorten the
period of due diligence and to defer the exclusivity provisions
until such time as we have entered into a definitive agreement.
Since the Company's announcement on January 6, 2006 that it had
retained Seven Hills Partners LLC ("Seven Hills") as its financial
advisor, we have tried numerous times, albeit unsuccessfully, to
establish a dialogue with Seven Hills in order to discuss our
proposal offer and to begin a due diligence review. If Seven Hills
was truly retained to fairly evaluate all offers, then why have
they continuously rebuffed our attempts to engage in meaningful
discussions and failed to provide us with any information despite
our willingness to enter into a confidentiality agreement? In fact,
we have contacted Seven Hills eight times and have received no
information or any indication that we will ever be provided with
information that a financial advisor would typically provide to an
interested purchaser. We are also troubled by the curious timing of
the announcement of the Company's stock buyback program and the
idea that the Company is using the artificial increase in the price
of the stock due to the buybacks to make our offer appear
inadequate. As we have previously stated, we are willing to
consider circumstances that may justify a further increase in our
offer. The Company has gone to great lengths to let stockholders
and other interested parties know that despite the adoption of the
Shareholder Rights Plan, it is willing to consider a Qualified
Offer (as defined in the Shareholder Rights Plan), subject to
several conditions designed to ensure that the Company's
stockholders are treated fairly. It is ironic, indeed, that
although our offer satisfies what we believe to be the most
important of these conditions for stockholders, the Special
Committee of the Board of Directors continues to publicly state
that our proposal is not in the best interest of the Company's
stockholders. We are prepared and eager to meet with the members of
the Board of Directors or its financial advisor at any time to
negotiate a transaction. However, if we do not hear back from the
Board of Directors or the financial advisor, we will assume that
the Company is not interested in engaging in discussions. While we
believe our offer provides a unique and timely opportunity for the
Company's stockholders to realize the full value for their shares,
we trust that you will publicly articulate the Company's current
outlook for expected financial performance, dividend continuation
and product strategy so that all stockholders will be adequately
informed and can appropriately assess value. *T About Bell
Industries, Inc. Bell is comprised of three diversified business
units: Bell Tech.logix, Recreational Products Group and J.W.
Miller. Bell Tech.logix offers a comprehensive portfolio of
technology products and managed lifecycle services, including
planning, product sourcing, deployment and disposal, and support
services. Bell's Recreational Products Group distributes
after-market parts and accessories primarily to the recreational
vehicle and boating markets. J.W. Miller manufactures and sells
standard and custom magnetic components used in electronic
applications for computer, medical, lighting and telecommunication
equipment. Forward-Looking Statements Statements in this press
release may be "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements are based on current expectations, estimates and
projections about the company's business based, in part, on
assumptions made by management. These statements are not guarantees
of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual
outcomes and results may, and probably will, differ materially from
what is expressed or forecasted in such forward-looking statements
due to numerous factors, including those described above and those
risks discussed from time to time in the company's filings with the
Securities and Exchange Commission, including Factors That May
Affect Future Results of Operations included in the Form 10-K for
the year ended December 31, 2004 and Management's Discussion and
Analysis of Financial Condition and Results of Operations in the
Form 10-K for the year ended December 31, 2004 and the Form 10-Q
for the quarter ended September 30, 2005. In addition, general
industry and market conditions and growth rates and general
economic conditions could affect such statements. Furthermore,
there is the risk that this offer may not be accepted by The Coast
Distribution System or, if accepted, the transaction will not be
consummated. Any forward-looking statements speak only as of the
date on which they are made, and the company does not undertake any
obligation to update any forward-looking statement to reflect
events or circumstances after the date of this release. Additional
Information Investors and security holders are urged to read the
disclosure documents regarding the proposed merger as they become
available because they will contain important information.
Investors and security holders will be able to obtain a free copy
of any such disclosure documents as they become available, as well
as other filings containing information about Bell Industries and
The Coast Distribution System, without charge, at the SEC's
internet site (http://www.sec.gov). Copies of the disclosure
documents and the filings with the SEC that will be incorporated by
reference in such disclosure documents can also be obtained without
charge, as they become available, by directing a request to
PondelWilkinson Inc., as information agent for Bell Industries,
Inc. at 1880 Century Park East, Suite 700, Los Angeles, CA 90067,
telephone: 310-279-5980, e-mail address: investor@pondel.com. The
directors and executive officers of Bell Industries may be deemed
to be participants in the solicitation of proxies from The Coast
Distributions Systems shareholders in respect of the proposed
merger. Information regarding the directors and executive officers
of Bell Industries is currently available in its proxy statement
filed with the SEC by Bell Industries on April 22, 2005. Other
information regarding the participants in such proxy solicitation
and a description of their direct and indirect interests, by
security holdings or otherwise, will be contained in any disclosure
documents and any other relevant materials that will be filed by
Bell Industries with the SEC as they become available. Any
information concerning The Coast Distribution System contained in
this document has been taken from, or is based upon, publicly
available information. Although Bell Industries does not have any
information that would indicate that the information contained in
this document that has been taken from such documents is inaccurate
or incomplete, Bell Industries does not take any responsibility for
the accuracy or completeness of such information.
Bell (AMEX:BI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Bell (AMEX:BI)
Historical Stock Chart
From Jul 2023 to Jul 2024