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Wednesday, August 27, 2008

Steel Group Rumored to Have "Forced" IKON Sale

From an article at

"...This is all driven by Steel Partners. They're one of the most aggressive hedge funds in the world, with $9 billion in assets under management," said Park. "They've been really public, and this is no real surprise," he added. "They're the largest shareholder. They own about 10 percent at a cost of about $10.51." Steel pushed Ikon last year to buy back shares at $17.50; Ikon balked, paying up to $15 in a limited buyback that boosted the company's debt."

And off of the author's blog -

As of June 30, 2008, Steel owned 12,456,300 shares at an average cost of $10.51/share.

Assuming the deal goes through, Steel will realize a hefty $84M gain on their four year investment.

Steel began pressuring IKN in June 2007 to do a $850M share buyback at $17.50/share. After Steel announced their intention to obtain board representation, IKN announced (in November 2007) a $500M buyback - which included a $295M dutch auction between $13 and $15/share and the balance to be purchased on the open market over the next year or so. As a result, Steel signed a standstill agreement and agreed not to seek board representation through 2009..."

My previous post on Steele:

IKON and Steel Partners - How IKON Will Be Sold

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