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Smith Corona Has Suitors, But No Value For Holders - Twice

Smith Corona Has Suitors, But No Value For Holders

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There are white knights waiting in the wings to rescue Smith Corona from its Chapter 11 bankruptcy proceeding, but all of the takeover proposals would wipe out the value of the company's common stock.

In a statement issued last week, Smith Corona said it had received several acquisition offers, but none of them called for "full satisfaction of creditors' claims or consideration to current shareholders." So, the company said, it is "extremely unlikely" that its common stockholders would receive anything. Smith Corona said it hoped to reach a definitive agreement soon.

The only suitor so far identified is Swedish typewriter and computer equipment manufacturer Facit, which said it was willing to pay off Smith Corona's debt in return for all assets, consisting primarily of a new factory in Mexico and the brand name.

The biggest loser in such a takeover will be the U.K. conglomerate Hanson, which retained a 48% interest when it took Smith Corona public in 1989. It had planned to include Smith Corona in the non-core U.S. operations it transferred to U.S. Industries earlier this year, but the typewriter maker's shaky financial condition prevented that.

Hanson's search for a buyer ended in July when Smith Corona filed its bankruptcy petition.

all assets, consisting primarily of a new factory in Mexico and the brand name.

The biggest loser in such a takeover will be the U.K. conglomerate Hanson, which retained a 48% interest when it took Smith Corona public in 1989. It had planned to include Smith Corona in the non-core U.S. operations it transferred to U.S. Industries earlier this year, but the typewriter maker's shaky financial condition prevented that.

Hanson's search for a buyer ended in July when Smith Corona filed its bank-ruptcy petition.

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