Harvey Receives Tender Offer

By Alan Wolf -- TWICE, 4/10/2006

Oxford, Mo. — Modern Technology, a diversified technology and development company based here, is initiating a tender offer to acquire Harvey Electronics, the New York metro area A/V specialty chain.

Modern Technology has offered to purchase 51 percent of Harvey's common stock for $1.15 per share in cash and stock, representing a premium of $0.50 a share over the company's present share price of $0.65.

“We feel this to be an outstanding offer to current Harvey Electronics shareholders,” said Anthony Welsh, chairman of Modern Technology. Welsh promised stockholders a “new and more powerful combined organization, with far greater market liquidity, a fantastic vision, a model of continuous growth” and expectations of $65 million in profitable revenue for 2006.

Harvey, which has posted weakened earnings in recent quarters, has asked its shareholders to take no action until the company's board has had time to obtain and review more specific terms of the proposal, said chairman Michael Recca.

Modern Technology established a toe-hold in the New York metro CE market last year with the acquisition of Sound City, a $9 million Denville, N.J.-based custom showroom and installer with two storefronts and an established mail order and e-commerce business managed by president/CEO Kamel Yassin.