Aldila, Inc. intends to commence a “Dutch auction” tender offer to acquire shares of its common stock. The company intends to spend up to $7.5 million to repurchase up to 496,688 shares of common stock, or up to 9.0% of the outstanding shares at a price per share not greater than $16.85 and not less than $15.10. The tender offer is expected to commence on August 24, 2007 and to expire at 12:00 midnight, Eastern Time, on September 21, 2007, unless extended.
The maximum offer price will represent a premium of approximately $1.25 per share over the closing price on August 17, 2007, the trading day before the first announcement of the offer. This represents a premium of approximately 8% to the average price at which Aldila was trading on the NASDAQ Global Market in the six month period preceding this announcement and a premium of approximately 6% to the average trading price for the one year period preceding this announcement.
This modified “Dutch auction” will allow shareholders to indicate how many of their shares and at what price within the $15.10 to $16.85 range the shareholders wish to tender. Based on the number of shares tendered and the prices specified by the tendering shareholders, the company will determine the lowest price per share within the range that will enable it to purchase up to $7,500,000 worth of shares, (496,688 shares or a lesser amount depending on the number of shares properly tendered). All shares accepted in the tender offer will be purchased at the same price. The company will not purchase shares below a price stipulated by a shareholder, and in some cases, may purchase shares at prices above a shareholders stipulated price. Specific instructions and a complete explanation of the terms and conditions of the tender offer will be in the offer to purchase and related materials which will be mailed to shareholders of record promptly after commencement of the tender offer.
In conjunction with this announcement, the company is terminating its existing stock buyback program, which it had established on July 28, 2006. Under that program, the Company repurchased approximately 108,000 shares of the companys common stock in open market transactions
Although the companys Board of Directors has approved this tender offer, neither the companys Board of Directors nor its management is making any recommendation to stockholders as to whether to tender or refrain from tendering their shares. Stockholders are urged to evaluate carefully all information regarding the tender offer and consult their own investment and tax advisors before making their decision as to whether to tender their shares and, if so, how many shares to tender and at what price or prices to tender them.
