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Coleman Agrees To $545 Million Buyout By Perelman Group

March 20, 1989

NEW YORK (AP) _ Coleman Co. has agreed to a $545 million buyout led by MacAndrews & Forbes Holdings Inc., a company controlled by takeover strategist Ronald O. Perelman, the companies said today.

Coleman, famed maker of lanterns and camping equipment that is controlled by its founding family, entered into a definitive agreement to be acquired for $74 a share in cash.

The family, which controls about 27 percent of Coleman’s 7.1 million common shares outstanding, on Feb. 14 had offered $64 a share to take the company private in a debt-financed takeover.

A number of analysts speculated that overture may have been an attempt to open the company up to competing, higher offers that would get the family more money for its holdings. However, the family indicated its buyout proposal was aimed at enabling it and senior management to focus on Coleman’s long-term interests.

Coleman stock soared $4.37 1/2 to $72.87 1/2 a share in early New York Stock Exchange trading today.

The companies said Coleman accepted the MacAndrews & Forbes offer following an auction set up by a special committee of Coleman’s board, which was appointed to consider the family-led buyout offer. A brief joint statement issued by the companies did not indicate whether other bids were received.

The merger agreement has been approved by the special committee and by Coleman’s board of directors.

Under the agreement, MacAndrews & Forbes would begin a $74 a share tender offer by Friday for all outstanding Coleman shares. The offer was conditioned on at least two-thirds of the shares being tendered.

The deal also gives MacAndrews & Forbes the option to acquire up to 18.5 percent of Coleman’s outstanding common shares for $74 a share, if those shares are needed to help satisfy the minimum tender provision, the companies said.

Coleman had record sales of $657.9 million and record earnings of $24.5 million in 1988.

In addition to its famed lanterns, Coleman is one of the world’s biggest makers of outdoor recreation equipment such as coolers, sleeping bags and pop- up travel trailers. The company also makes air conditioning equipment, lawn movers, home and recreational vehicle heaters, air guns and electrical generators.

MacAndrews & Forbes is a sprawling conglomerate with interests ranging from jewelry to licorice extract.

It is controlled by Perelman, who became chairman of Revlon Group Inc. after leading a successful takeover fight for the cosmetics company and made a lucrative although unsuccessful run at Gillette Co., the personal products maker.

Late last year, a group led by Perelman put up $315 million and got $5.1 billion of government aid to acquire five bankrupt Texas thrift institutions with assets of more than $12 billion.

-03-20-89 1204EST

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