REXDALE, Ontario-Pensler Capital Corp., Charles Sherkin, president of United Tire & Rubber Co. Ltd., and an undisclosed third party will offer more than $6 million for United Tire in mid-February. Mr. Sherkin said he will retain a 30-percent share of the company, but the remaining share holders agreed in December to sell their stock to the bidders for about $2.18-per-share (converted from Canadian dollars at the Jan. 26 exchange rate).
Sanford Pensler, president of Pensler Capital, would not say how large a share his company would purchase.
The bid will be submitted following an inspection period for the bidders.
Once the sale is complete, the public company will become private and Mr. Sherkin will assume the additional position of CEO, he said.
Inter-Provincial Diversified Holdings Ltd., currently the primary stock holder with about 43 percent of United Tire's common stock, will pull completely out of the Rexdale-based tire maker and distributor, said Robert Scolnick, United Tire chairman and vice president of IPDH.
Mr. Scolnick would not say why IPDH was selling its shares.
IPDH and the remaining shareholders-including Inco Ltd. (12 percent)-agreed in December to tender their shares into the take-over bid.
IPDH, a Toronto investment company, has been involved with United Tire for 20 years, Mr. Scolnick said.
Pensler Capital represents about 17 investors interested in acquiring other low-tech manufacturing businesses in the rub-ber and plastics industries.
``We feel (United Tire is) a fine company and would like to grow it,'' Mr. Pensler said.
United Tire produces radial and bias light truck, truck, earthmover/OTR and industrial tires at its Rexdale plant, which has a capacity of 250 units per day.
Pensler Capital also is bidding for two undisclosed rubber companies, the company president said.
The investment group is interested in low-tech units because they are something the group can easily understand, Mr. Pensler said.
The fragmented industry also leads to good chances for acquisitions, he said.
The sale will not affect United Tire's business, Mr. Sherkin said.
Last year the company reported nearly $27 million in sales.