Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, May 22, 1994 TAG: 9405220022
SECTION: VIRGINIA PAGE: E-1 EDITION: METRO
SOURCE: DAVID REED ASSOCIATED PRESS
DATELINE: BRIDGEWATER LENGTH: Medium
"We won today, and I think we won with a pretty easy cushion," WLR Foods President James L. Keeler said after a shareholders' vote.
"As a legal matter, today's vote is a battle, not a war, in Tyson's hostile takeover attempt," Keeler told shareholders. "But [Chairman Don] Tyson has repeatedly said that if he loses today, he will go back to Arkansas."
Tyson had said he would withdraw his offer if the vote went against his company, the nation's largest poultry producer. But after the vote, Tyson said the effort to acquire WLR, the nation's No. 4 turkey producer and No. 14 chicken producer, will continue. The official results won't be known for several days, he said, and lawsuits over the eligibility of voters are pending.
Tyson told about 550 shareholders packed into a high school auditorium that they would be better off joining his company.
"I just believe that in the food business, the No. 1 company makes real good money . . . the No. 2 company makes about half that much, and No. 8 and 9 and the rest struggle for their existence," Tyson said.
But the crowd, including many of the poultry growers owning about 20 percent of the stock, was overwhelmingly behind their homegrown company. They gave Keeler a standing ovation when he told Tyson, who was sitting in the crowd, "Don, we expect you to keep your promise to go away if you don't get 51 percent of the vote today."
"We don't need a General Motors of meat," Jim Powell, a shareholder from Lewes, Del., said during the meeting.
Stockholders said they were willing to pass up short-term profits because they believe WLR will continue to grow steadily and promote competition.
Tyson was trying to persuade WLR shareholders to give Tyson Foods voting rights on WLR shares.
Tyson Foods owns 600,000 shares, or about 5 percent, of WLR and needed support from more than half of the nearly 11 million shares outstanding to move ahead with the takeover.
Keeler said the preliminary tabulation shows that nearly 6 million shares voted against Tyson. He added that the shareholders made history because they gave Tyson its first defeat in an acquisition bid.
In January, Tyson offered to buy WLR for about $330 million, or $30 a share, when WLR shares were selling for $19.
The WLR Foods board of directors immediately rejected the proposal. The Broadway-based company has been trying to ward off a hostile takeover ever since.
Wall Street indicated on the eve of the vote that WLR would have the votes to win. WLR's stock fell 75 cents Friday to close at $26.50 a share. It had gone as high as $31 but fell to less than $30 a share last week for the first time since early March.
"There appears to be a lot of loyalty, and I guess New York has figured it out," said George Shipp, a Norfolk-based analyst with Scott and Stringfellow Inc.
Charles Horn, who raises turkeys for WLR in Mount Solon, told fellow stockholders, "This company has been super to grow for. We're all like family. We don't want to go to Arkansas for our grower picnic."
by CNB