UPS Urges Shareholders To Reject TRC Capital's Mini Tender Offer

(RTTNews) - United Parcel Service Inc (UPS) on Thursday said it has received notice of an unsolicited mini-tender offer by TRC Capital Corp to purchase up to 1.5 million shares of UPS' Class B common stock for $95.25 a share.

UPS said it does not endorse this mini-tender offer and recommends that shareowners reject it.

According to the package delivery giant, the offer price in the unsolicited mini tender by TRC Capital is about 4.4% below the $99.67 a share closing price of the stock on March 12.

The shares in TRC Capital's mini tender offer represent about 0.2% of the outstanding Class B shares as of February 18, the company said.

UPS said it is cautioning its shareholders of the potential adverse consequences of participating in TRC Capital's mini tender offer, which is subject to various conditions.

TRC Capital's offer states that it may terminate the offer if, among other things, there is a decrease in the market price of UPS shares or if TRC Capital is unable to obtain sufficient financing.

The tender offer also stipulates that shareowners must tender their shares for potential purchase by TRC Capital and once tendered, unless successfully withdrawn, shareowners may be unable to sell those shares until April 20, the final withdrawal date.

Mini-tender offers are designed to seek less than five percent of a company's outstanding shares, thereby avoiding disclosure and procedural requirements of the U.S. Securities and Exchange Commission that are designed to protect investors.

The SEC has cautioned investors about mini-tender offers, which bidders make at below-market prices, hoping they will catch investors off guard and sometimes fail to provide prompt payment.

TRC Capital has made similar mini-tender offers for the shares of other companies.