MPR’s Annie Baxter gets the scoop: local moguls Vance Opperman and Glen Taylor, thwarted in their bid to get 25-35 percent of the Star Tribune, decided not to take any stake at all. They could come back with another offer, though their lawyer says that’s “unclear.”
Guess this means no board seats.
“A lawyer for the investment fund says the paper’s current owners offered to sell less than a 25 percent equity stake, so Taylor and Opperman declined to proceed.”
Curiouser and curiouser. A twenty-five percent equity ownership interest is probably not enough to give control in these circumstances since the majority of the shares would be held by other owners in a close partnership. Why would Taylor and Opperman make ownership of a less than controlling interest a condition of their purchase? Particularly in this case where it’s pretty clear that their offer was for considerably more than the shares are worth?
I think Brauer’s earlier posting may suggest answers. What Taylor and Opperman were trying to do was establish a floor value for the shares. Going forward, the Star Tribune can now use the Taylor-Opperman as a benchmark for valuing the equity interest in the company. But the problem with that is that no knowledgeable investor will be fooled. The fact that Taylor and Opperman backed away from the deal after having received a qualified yes for an answer undermines the credibility of their original offer. Without an actual exchange of dollars for equity, there is nothing here except a lot of hot air.
That’s OK. They can probably buy the paper from the current owners in a year or two for pennies on the dollar after the owners further run it into the ground.
Hey, Strib, how about some more crime news!