Wednesday, August 19, 2009

Desert Equity's Bid

Desert Equity LP has offered $4.25 per share for up 3.74 million shares of the stock of White Electronic Designs Corp., a computer chip manufacturer headquartered in Phoenix.

This is an insider's buy-out proposal. Desert Equity is itself controlled by the chairman of White Electronics, Brian Kahn.

Desert Equity first announced plans for the cash offering on Thursday, August 13, which was in turn just six days after the board of directors of White Electronics voted to eliminate the "poison pill" it had created back in 1996.

Share price has had a very wide range over the last year, from $3 to $5.25. Its has been a tumultuous year, featuring a proxy fight annouynced in February and settled earlier this month. the stock price closed yeserday, August 18, at $4.22, on low volume. This would seem to indicate that the market believes the deal will go through, so the price of the target will stay near the buy-out offer until the deal is consummated.

White Electronic has also announced that former Cubic Corp. executive Gerald Dinkel would take over as president and CEO, filling a position that had been vacant for a year.

A bit of corporate history to round this out: White Electronics is an Indiana corporation that began life in 1951 as Bowmar Instrument Corporation (Bowmar).

On October 26, 1998, Bowmar merged with Electronic Designs, Inc. (EDI) and the combined firm adopted the present name.

In 2001, White electronics acquired Panelview, Inc. (Panelview), a designer and manufacturer of enhanced commercial flat panel display products.

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