Weber stock jumps 25% after top shareholder makes takeover bid for grill maker

Shares of Weber Inc. soared more than 24% in after-hours trading on Monday, reflecting an offer from its largest shareholder to buy the grill maker’s remaining shares for $6.25 apiece.

Weber’s WEBR offer to purchase,
27.5 million shares not currently held by BDT Capital Partners represent a 24.8% premium to the grillmaker’s closing price on Monday. Weber was mentioned as a potential meme stock, having been noted for its high short interest and small stock float.

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BDT Capital Partners on Monday delivered a letter to Weber’s board of directors detailing the proposed purchase of the grill maker’s outstanding shares, according to a filing with the Securities and Exchange Commission.

“Our proposal provides immediate liquidity to the company’s public shareholders, while eliminating the risks to public shareholders in the current market and operating environment that the company’s current debt position may not be sustainable and that the company may not be able to effect a recapitalization,” the offer letter states.

“We wish to emphasize that in our capacity as a shareholder of the Company, we are only interested in acquiring the shares of the Company which we do not currently hold and, therefore, we have no interest in disposing of or to sell our interests in the Company or Weber Holdco, LLC and we have no interest in participating in any other change of control transaction involving the Company,” the letter added.

Earlier this month, Bloomberg reported that Weber was considering debt financing from BDT Capital Partners, which owns nearly half of the company’s stock at 48.16%, according to FactSet. MarketWatch has contacted Weber for comment.

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In mid-August, Weber reported a bigger-than-expected third-quarter loss. The company also announced a plan to cut costs and preserve cash amid rising inflation and supply chain disruptions that have slowed retail traffic.

A few weeks later, the grill maker suffered a sell-off that also appeared to affect stocks of Bed Bath & Beyond Inc. BBBY memes,
GameStop Corp. EMG,
and AMC Entertainment Holdings Inc. AMC,

Weber’s stock has fallen 61.1% this year and ended Monday’s session down 4% at $5.03. The S&P 500 SPX index,
which is down 20.3% in 2022, closed up 1.2% on Monday. Of seven analysts polled by FactSet, three have a hold rating for Weber and four have an underweight or sell rating.

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