Trans World Entertainment Pledges $25 million Shareholder Stock Repurchase28 Jun, 2013 By: Erik Gruenwedel
Tender offer follows the parent of f.y.e. retail chain’s special $15 million cash dividend at the end of 2012
Trans World Entertainment Corp. June 28 said its board of directors authorized it to repurchase shares of the company's common stock in a "modified Dutch auction" tender offer for up to $25 million in value of its common stock.
The Albany, N.Y.-based corporate parent of the f.y.e. (For Your Entertainment) entertainment retail chain said shares would not be repurchased for less than $4.50 and not more than $5.10 per share. This price range represents a 13% premium to 28% premium on the average closing price per share for the Trans World’s common stock for the last 120 days.
A "modified Dutch auction" tender offer allows shareholders to indicate how many shares and at what price(s) they wish to tender within the company's specified price range. Based on the number of shares tendered and the prices specified by the tendering shareholders, Trans World will determine the lowest price per share within the range that will enable it to purchase $25 million in value of its common stock (or a lower amount if the offer is not fully subscribed). All shares purchased by the company in the tender offer will be purchased at the same price.
Robert J. Higgins, chairman of the board and CEO did not participate in any of the board's decisions regarding the tender offer.
Trans World Entertainment expects to fund the offer from cash on hand and does not expect to borrow any funds for the purpose of the offer, according to a regulatory filing.