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Show 4monday, 14, 1977, Stockholders win out; merger is off of Swing Bike, a Logan based marketer of bicycles, forced an abrupt end to merger negotiations between Swing Bike and Glas-c- o Stockholders Inc. late last week only one day after the proposal was announced. Glasco Inc., a shell with no assets and no business, sent a letter to its on-goi- ng shareholders on Nov. 1 saying the two companies were preparing a registration statement for the Securities and Exchange Commission re- garding a stock exchange to effect a merger. Swing Bike proposed issuing one share of its stock for two of Glasco's, 520,000 shares of Sw ing Bike. But since Swing Bike became public last summer through a merger with Gayle Industries shortly after negotiations with Glasco began, the price of its stock has appreciated more than SI . At a bid price of the transaction was valued at over 2-1- 8, million. The day after the merger proposal was announced, shares of Swing Bike, trading over the counter in on Utah, dropped from 8 $1 2-1- the bid to According to a shareholder letter from Swing Bike dated Nov. 2, "certain stockholders and members of the brokerage community reacted adversely to the proposed terms of the merger." Local brokers, who pleaded not to be identified, speculate the adverse price reaction to the announcement reflected stockholder discontent over the terms of the exchange. And the discontent centered on the price Swing Bike was offering to pay for a shell lacking assets or operational revenues, they said. In Swing Bike's rescission, dated Nov. 2. chairman Patrick Hoggan said the proposed merger would cause "Swing Bike to become a company with the SEC and would qualify the company's securities to trade RICK CLAYTON Commerce Printing No money involved. Thats the beauty of it. We can bring you new customers and clients. We can reduce your operating costs. We can decrease your expenditures. We can increase your profits. And by profits we mean money in the bank. Call us to learn more about this new, profit- able way to exchange your goods and services for those of others. Its really as old as the hills. full-reporti- in many states." Hoggan also said the merger would substantially broaden the com- panys stockholder base. But the brokers had their doubts. One said Swing Bike could become a fully reporting company at a cost of $15,000 to $20,000. A brief Enterprise survey of local attorneys found that a company with a clean slate could easily achieve fullreporting status with $15,000 in legal fees. Once the merger agreement was rescinded, however, Swing Bike shares regained their previous level. As one broker put it, "This is one of the first times I've seen shareholders get their way, and I feel pretty good about it." INTERCHANGE BARTER BROKERS 3333 South 900 East, Suite 240 Salt Lake City, Utah 84106 Telephone (80 1 ) 486-74- 4 1 |