FTC GIVES OK FOR LSAI BUYOUT

WASHINGTON — The Federal Trade Commission Wednesday gave its antitrust go-ahead to a planned buyout through a $265-a-share offer of all nonfamily shareholders of Levi Strauss Associates Inc. (LSAI), and also will allow Levi Strauss descendants to raise cash with some of their stock, if they choose.
The FTC made its announcement, without elaboration, in its daily listing of acquisitions the agency has found pose no anticompetitive problems.
Last week, a Levi’s spokesman said that contrary to published reports, it is impossible to estimate the value of LSAI Holdings Corp. shares until the amount of debt accrued in the merger is calculated. LSAI Holdings is the new company that is purchasing LSAI.
Currently, the company has a $1 billion cash surplus.
Levi’s family members who hold class-L shares are still determining what portion of their shares they will keep, and what portion they will cash out. Levi’s expects the merger to be consummated in late March or early April, the spokesman said.
One thousand Holdings shares were issued initially and were sold for $250,000. The shareholders include Robert D. Haas, chief executive officer and chairman of Levi Strauss & Co.; investment bankers F. Warren Hellman and Tully M. Friedman, and Thomas J. Bauch, Levi’s senior vice president and general counsel.
A 331-to-one stock split this year left Robert D. Haas with 264,550 shares, Friedman and Tully with a total of 39,682 shares and Bauch with 26,455, according to the filing.
The spokesman also denied a published report that the initial purchasers got a bargain on the Holdings shares as a reward for organizing the merger. Robert D. Haas and Hellman will be two of the four voting trustees who will control Holdings once the merger is complete. The other two trustees are Peter E. Haas Jr. and Peter E. Haas Sr., the cousin and uncle of Robert D. Haas, respectively.
“Because their beneficial ownership of Holdings shares following the merger is likely to well exceed one-third of the outstanding Holdings shares, the voting trustees are likely to have the ability to perpetuate themselves as voting trustees and thereby choose the Holdings board for the duration of the Holdings Trust,” the SEC filing said.

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