WALTHAM, Mass. — The board of directors for Mac-Gray Corp. has unanimously rejected an unsolicited written proposal from KP Capital to acquire Mac-Gray for $17.50 in cash per share, Mac-Gray reports.
Mac-Gray manages laundry rooms in multi-unit housing facilities, and sells and services commercial laundry equipment to Laundromats and other customers.
The board determined that pursuing the transaction proposed by KP Capital, or a sale process, would not be in the best interests of the company’s shareholders at this time. Mac-Gray can best maximize long-term shareholder value by continuing to aggressively implement the strategic, operational and financial initiatives under way, as well as those specific initiatives contemplated in an updated business plan, the board believes.
“The board of directors, with the help of two top-tier outside financial advisers and counsel, carefully evaluated all relevant aspects of the KP Capital proposal and of a possible sale process, including undertaking the significant risks and uncertainties with such a process at this time,” says Thomas E. Bullock, board chairman.
Mac-Gray’s strengths, growth opportunities and financial prospects were among the factors considered by the board.
KP Capital stated that its proposal was backed by both debt and equity financing sources, but would not identify those sources absent execution of a confidentiality agreement and a commitment by Mac-Gray to pursue discussions, Mac-Gray says.