Management Group, Others Made Offers for Stanley Before Recent Sale

December 29, 2017  by Larry Thomas in Business Strategy, Industry   

One of the offers came from a management group headed by Glenn Prillaman, who resigned as CEO a few days after the sale to Vietnam Trade Alliance Chairman Walter Blocker was announced.

At $13.5 million, the management group’s offer was the lowest one received (the other three ranged from $15 million to $24 million), but it included a sweetener that Prillaman and others would waive their rights to receive so-called “golden parachute” payments after an ownership change, according to the filing.

The filing said Blocker originally offered $18 million in July, then upped the offer to $19.6 million in advance of a Sept. 22 board of directors meeting, during which the board evaluated proposals from Blocker, the management group, and an unidentified party that submitted a $16 million offer.

However, shortly after the meeting ended, Prillaman learned that the licensor of Stanley’s Coastal Living collection would not renew the licensing agreement when it expired at the end of 2017. Since the collection accounted for more than 20% of the company’s sales each of the past two years, the board told the bidders they could revise their proposals.

According to the filing, the management group left its $13.5 million offer unchanged, but Blocker lowered his offer to $17.6 million and the other bidder went down to $14.5 million.

The management group withdrew its proposal on Oct. 18, and the other party was unable to line up financing for its offer, so the board entered into an exclusive negotiation period with Blocker. 

Those talks resulted in the $16.1 million sale agreement, which was announced Nov. 20.

As part of his separation agreement, Prillaman received a severance payment of $255,000 two days after his resignation and was immediately vested in 491,607 shares of restricted stock. He will get a $510,000 severance payment two days after the sale closes or is terminated.

The filing also indicated Vice President of Finance Anita Wimmer would be offered a job by the new owner, but not as the company’s principal accounting officer. As a result, she is eligible for a golden parachute payment of $360,000 (two times her annual salary), plus an additional $35,487 in dividend payments on restricted stock she owns.

The sale must still be approved by Stanley stockholders, and the filing said a special shareholders meeting would take place in January.