Hasbro Extends Tonka Bond Tender Offer
ST. LOUIS PARK, Minn. (AP) _ Hasbro Inc. extended its deadline for Tonka Corp. bondholders to tender their securities after the investors balked at the terms of Hasbro’s planned buyout of the nation’s third-largest toymaker.
Hasbro had set a deadline of midnight Monday for holders to tender the bonds. However, the company decided to extend the deadline until 7 p.m. EST April 8 after holders of only about 15 percent of the bonds tendered their holdings.
Under its buyout agreement with Tonka, Hasbro must receive 90 percent of outstanding 16 1/4 percent Series A subordinated debentures due Dec. 1, 1997 and 17 1/4 percent Series B subordinated debentures due Dec. 1, 1999.
Hasbro has offered $800 per $1,000 of the principal amount for the Series A and $750 per $1,000 of the Series B, but
Goldman, Sachs & Co., which owns about 50 percent of Tonka’s bonds and has been blocking Hasbro’s bid to buy Tonka, has not agreed to sell the bonds, Tonka spokeswoman B.J. French said Monday.
Monday’s deadline extension was the second since the two companies agreed to the buyout in February.
Tonka stockholders, who would receive $7 per share under the buyout, have approved the deal.
Alan G. Hassenfeld, chairman and chief executive officer of Hasbro, said his company’s $470 million offer for Tonka was ″a full and fair price, especially in light of Tonka’s results, financial conditions and prospects. We do not intend to pay any more for the business.″
Tonka, with headquarters in St. Louis Park, is the nation’s third largest toy and game company behind Hasbro and Mattel Inc. The company’s operating divisions include Kenner Products, based in Cincinnati, Ohio; Parker Brothers, based in Beverly, Mass., and Tonka Products and Tonka International, based in St. Louis Park.
Tonka products include Monopoly and Sorry board games, Play-Doh modeling clay and Tonka trucks.