NEW YORK (TheStreet) -- Shares of Central Garden & Pet Co. (CENT) are slightly lower in heavy trading volume this afternoon after it was reported that Philip Falcone's $1.1 billion bid for the marketer and producer of branded products may look like just another prospective M&A deal, but there is a twist: the company is technically takeover proof, the Financial Times reports.
By taking his case directly to CG&P shareholders, Falcone, CEO of Harbinger Group (HRG) faces a company in which power is concentrated in the hands of the company's founder and chairman, Bill Brown, who holds 55% of the voting rights with only 12.5% of the equity shares, the Times said.
Harbinger on Monday made public a $10 a share cash offer for CG&P after failing to privately agree on a deal with Brown and his board.
Harbinger shares are up 0.85% to $13.12.
TheStreet Ratings team rates CENTRAL GARDEN & PET CO as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate CENTRAL GARDEN & PET CO (CENT) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins."