
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, January 27, 1994                   TAG: 9401270052
SECTION: BUSINESS                    PAGE: B8   EDITION: METRO 
SOURCE: Associated Press
DATELINE: HINTON, VA.                                LENGTH: Medium

BUYOUT BID BOUNCES WLR STOCK

WLR Foods Inc. stock continued heavy trading Wednesday after a takeover bid by Tyson Foods Inc., but WLR's directors said the company and its stockholders would benefit in the long run by remaining independent.

WLR stock fell 62 cents a share, closing at $27.87 on Wednesday after trading 919,700 shares. On Tuesday, the company's stock rose $9.50 a share, closing at $28.50. Nearly 3.9 million shares were traded Tuesday, a record for WLR, according to Marshall Hopkins, an analyst with Wheat First Securities in Richmond.

Tyson, the nation's top poultry producer, said Monday it had proposed acquiring WLR Foods, the eighth-largest poultry producer.

WLR Foods has about 3,000 employees in Rockingham County. The Springdale, Ark.-based Tyson has about 42,000 employees, including about 550 in the central Shenandoah Valley.

The proposal from Tyson came "totally unsolicited," WLR spokeswoman Gail Price said.

WLR's directors, she said, "will evaluate the proposal in due course. But the board of directors believe the long-term interest of the company and stockholders would be best served by remaining independent."

Under a proposal provided to WLR's board, Tyson said in a news release, WLR's shareholders would receive $30 a share for their company to merge into Tyson or a Tyson subsidiary. As an alternative, Tyson proposed negotiation of a tax-free reorganization under which WLR shareholders would get part cash and part Tyson stock for their WLR shares.

As a publicly traded company, WLR is legally obligated to consider the offer. Tyson set a Feb. 4 deadline for a response.

WLR's sales for the fiscal year ended July 3 were about $167 million, 2 1/2 times the prior year's earnings, Price said.

WLR also has announced plans to expand its Cassco Ice & Cold Storage division, which has a warehouse in Roanoke, with construction of a $4.2 million addition to the warehouse complex at Pleasant Valley in Buckingham County. The 65,000 square feet of frozen and refrigerated space is to be completed in July.

by CNB