This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Mac-Gray Board Unanimously Rejects Acquisition Proposal

WALTHAM, Mass., Oct. 24, 2011 /PRNewswire/ -- Mac-Gray Corporation (NYSE: TUC), the nation's premier provider of laundry facilities management services to multi-unit housing locations, today announced that its Board of Directors unanimously rejected an unsolicited written proposal from KP Capital, LLC to acquire Mac-Gray for $17.50 in cash per share.

The Mac-Gray Board of Directors has completed the comprehensive evaluation it undertook in response to the KP Capital proposal.  The Board's evaluation process included a meeting among two Board members and KP Capital, multiple Board meetings, the assistance of two independent financial advisors, and a thorough, special review of the current and updated business plan from Mac-Gray management.  Based on its evaluation, the Board has unanimously 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.  The Board believes that the Company can best maximize long-term shareholder value by continuing to aggressively implement the strategic, operational and financial initiatives currently under way as well as those specific initiatives contemplated in the updated business plan.

"The Board of Directors, with the help of two top-tier outside financial advisors 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," said Thomas E. Bullock, Chairman.  "Among the factors the Board considered were the Company's existing strengths, growth opportunities and financial prospects, including the strategic and operational initiatives already under way."

The Managing Member of KP Capital is Benjamin Kovler.  At Mac-Gray's 2010 annual meeting, Mr. Kovler's affiliated entity, Kovpak II, LLC, made a proposal for the redemption of Mac-Gray's shareholder rights plan.  At Mac-Gray's 2011 annual meeting, Mr. Kovler nominated himself, Richard Drexler and Michael Soenen as directors.  None of Mr. Kovler's nominees were elected and Mac-Gray's shareholders re-elected each of the Company's director nominees.

KP Capital stated that its proposal was backed by both debt and equity financing sources, but at its meeting with Mac-Gray directors would not identify those sources, absent execution of a confidentiality agreement and a commitment by Mac-Gray to pursue discussions.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs