Discovery Group, which owns 13.8 percent of Maryland-based communications company Tessco, has made an offer to buy the rest of the company for $15.50 a share. The Discovery offer values the company at $117.4 million. The share price, at Wednesday’s close, was $12.34, a significant drop from May’s high price of $20.5.
(Reuters) – Shares of Tessco Technologies Inc rose 28 percent Thursday, a day after its largest non-management shareholder offered to buy the company for $15.50 per share.
Discovery Group, which currently owns 13.8 percent of Tessco’s outstanding stock through its funds, sent the proposal to the board on Wednesday.
The deal, which represents a 26 percent premium to Wednesday’s closing price of $12.34, values the company at $117.4 million.
In March, Discovery Group urged Tessco’s board to respond to acquisition interests it had received from private equity firms and large distribution companies.
Tessco Technologies was not available for comment.
Shares of the Hunt Valley, Maryland-based company have fallen 40 percent since touching a 52-week high of $20.5 in May. They were up $3.05 at $15.38 in morning trade on the Nasdaq.
(Reporting by Suzannah Benjamin in Bangalore; Editing by Don Sebastian)