THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Thursday, September 5, 1996 TAG: 9609050371
SECTION: BUSINESS PAGE: D6 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORT
DATELINE: RICHMOND LENGTH: 38 lines
Financially troubled Best Products Co. on Wednesday began studying a $63.2 million buyout offer from a Florida investment firm.
Miami-based Ocean Reef Management Inc. offered $2 per share in cash for each share of Best on Tuesday. It hopes to turn Best into a retail chain focusing on women's items such as perfume and cosmetics.
Best operates 169 stores in 23 states. The company earlier this year announced plans to close a total of 10 of its catalog showrooms in Virginia, Texas, Ohio, North Carolina and Maryland, and cancel nine new stores it had planned to open in the next two years.
Best did not plan on closing any of its stores in South Hampton Roads. The retailer has three traditional outlets and one jewelry store in the region.
Ross Richardson, a spokesman at Best's Richmond headquarters, said the company was evaluating the unsolicited offer and would have no announcement Wednesday.
``We believe we have found the right formula to transform Best from a catalog showroom retailer into a specialty retailer,'' said Rachmil Lekach, Ocean Reef's chairman and chief executive officer.
``We will not take a position on the proposed merger until we complete our review,'' said Daniel H. Levy, Best's chairman and chief executive.
Best lost $95.7 million last year, the second worst loss in the company's history. Its first-quarter loss this year was four times greater than it was for the same period a year ago.
Best emerged from bankruptcy in June 1994.
Three weeks ago Ocean Reef bought a 25 percent stake in L. Luria & Son Inc. for $8 million dollars. The Miami Lakes, Fla.-based catalog showroom chain has 43 stores in Florida.
Lekach, now Luria's chairman and chief executive officer, said selling perfumes and cosmetics and getting out of electronics and toys is part of his strategy to turn Luria around. He would use the same plan at Best. by CNB