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<br />
<br />..,Judge
<br />bid to
<br />Kaiser
<br />won't
<br />take'~I
<br />Steel
<br />By MICHAEL ROUNDS
<br />Rocky Mountain News Energy Writer
<br />Denver U.S. District Judge John
<br />Kane yesterday refused to stop a
<br />bid by a Minneapolis investor to
<br />take control at ailing Kaiser Steel
<br />Corp. al the company's annual
<br />stockholders meeting today.
<br />"The life of the company is at
<br />stake," said a Kaiser spokesman in
<br />California. Kaiser, which has of-
<br />fices in Colorado Springs and Fon-
<br />tana, Calif., said investor Bruce E.
<br />Hendry of Miweapolis will fire top
<br />management and sell company as-
<br />sets if he gets control.
<br />"Temporary restraining order
<br />hearings are extremely difficult
<br />for a trial judge who comes into a
<br />case where everyone else is al-
<br />ready fully armed and fighting;'
<br />said Kane. "He [finds bimseH in the
<br />middle of Armageddon with no no-
<br />lice.,,
<br />On Friday, Kaiser sued Hendry
<br />in federal court in Denver. The suit
<br />contends that Hendry violated Se-
<br />curities and Eachange Commission
<br />proxy solicitation rules and We Se-
<br />curities Eachange Act of 1934 in
<br />reporting his Kaiser holdings.
<br />Kaiser asked Kane to issue a
<br />temporary restraining order to
<br />prevent Hendry from voting prox-
<br />ies he solicited for electing a new
<br />shares of preferred Kaiser stock
<br />andoirns another 6,041 for his wife
<br />and son, but he may have enough
<br />proxies to get control of Kaiser's
<br />Corp.
<br />board. Another group, Massachu-
<br />setts High Income, a management
<br />investment company based in Bos-
<br />ton, holds more than 403,000
<br />shares of preferred stock.
<br />Kane, without commenting on
<br />the merits of the lawsuit, refused
<br />to stop Hendry's pazticipation in
<br />the meeting, partially because a
<br />Delaware Chancery Court had al-
<br />ready approved it.
<br />The meeting begins at 10 a.m. al
<br />the Stouffer's Hotel near Stapleton
<br />International Airport. ',
<br />Kaiser ran into financial diffi-
<br />culties when it couldn't sell tubular
<br />and other steel' products to the
<br />troubled oil industry. Kaiser has
<br />lost ;12 million so far this year,
<br />said lawyers for the steel compa-
<br />ny, and is losing money at the rate
<br />of ;120,000 a day, lazgely because
<br />its oil [field supply business virtual-
<br />ly vanished.
<br />As a result, it didn't make pre-
<br />ferred stock dividend payments
<br />due May 15 and Aug. 15 or put
<br />required payments into escrow.
<br />Under company bylaws, pre-
<br />ferred stockholders normally get
<br />to elect two directors, but because
<br />of the missed payments, preferred
<br />shareholders get to name six of the
<br />11 board members.
<br />L. ;Richard Freese Jr., a lawyer
<br />with the Denver law firm of Davis,
<br />Grabam & Stubbs representing
<br />Kaiser, told Kane that if.$t:nd~t,
<br />the chief executive officer and re-
<br />view'the tenure of remaining se-
<br />nior management. He intends to
<br />sea off some o[ the assets:'
<br />Safeway takeover OK'd;
<br />area impact uncertain
<br />B KIMBERLY MAYER said they can't support the buyout
<br />Y unless RKR agrees to protect their
<br />Rocky Mountain News $IaH Writer jet.
<br />Stockholders of Safeway Stores W WI 't' t f'nd out
<br />Inc. yesterday overwhelmingly ap-
<br />proved the;4.1 billion takeover of
<br />the grocery chain by Kohlberg
<br />Kravis Roberts & Co., a New York
<br />investment company.
<br />Although KKR has said it will
<br />sell Safeway assets to help finance
<br />the deal, the company said it still
<br />has not decided whether any Den-
<br />ver-division assets will be liquidat-
<br />ed.
<br />"We'll know fairly soon:' KKR
<br />spokesman Thomas J. Daly Jr. said
<br />yesterday.
<br />Sa[eway, the Denver area's sec-
<br />ond-largest grocery company with
<br />20.1% of the market, operates 134
<br />'stores from its Denver division,
<br />'down from ]50 at the beginning of
<br />the year. The division includes Col-
<br />orado and five other states.
<br />The Oakland, Calif: based super-
<br />market company agreed last July
<br />to be acquired by Safeway Stores
<br />Holdings Corp., a Hewly formed
<br />division of KKR. The final step in
<br />the acquisition was yesterday's
<br />stockholders' vote, in which 98%
<br />of those voting - representing
<br />83g° of Safeway's 61 million out-
<br />standing shares -endorsed the
<br />deal ___~`'^ _:_- -.~ ~~_._
<br />e are s wai mg o i
<br />what. impact the sale will have on
<br />our membership," said Joe
<br />Drexler, spokesman for the United
<br />Food and Commercial Workers
<br />union in Deuver.
<br />The UFCW represents 117,000 of
<br />Sateway's 172,000 workers nation-
<br />wide, and 7,000 of the company's
<br />9,000 Colorado workers.
<br />Dozens of Safeway employees
<br />have been relocated or laid off this
<br />year through the closure of 16 Den-
<br />ver division stores, including six in
<br />the metro area.
<br />In KKR's two-step buyout, hold-
<br />ers of the first 45 million Safeway
<br />shares tendered will receive;69 a
<br />share in cash. Owners of the re-
<br />maining shares will receive the
<br />right to two things - a junior sub-
<br />ordinated debenture, due 2006, in
<br />the principal amount of ;61.60,
<br />with an interest rate of 15%
<br />through Nov. 24, 1988, and 14.5%
<br />per year thereafter, and a pro rata
<br />share of wazrants to purchase a
<br />total of 4.64 million shares of the
<br />holding company for a total pur-
<br />chase price of ;17.5 million.
<br />Safeway stock fell '/a to 61'k on
<br />the New York Stock Exchange yes-
<br />terday.
<br />The two-part deal has a "blend-
<br />halt
<br />over
<br />Nou. 25, 1986, Denver, Cdo.
<br />Permit Number ~1 ~ Cj ~' [~ Z 3
<br />Class: OPermil
<br />Section/Exhibit
<br />Class~^ Revision •_._._._._._._._._._._._._._._._._._. _._._._._._._
<br />' TypelSeq_
<br />Class: O Report O Hydro eneral ~y]7
<br />Da Type:_ GUIG~ti ~ a/(C 3 Po.~LCn c_G
<br />- - ---------
<br />DApplication (Coal only) ^ Bond O Entorcemenl ^ Inspection
<br />
<br />INVESTMENTS
<br />-~.~
<br />~,.. .
<br />Good looking, 33 1-bdrm., 47 2-bdrm. (35 with 2
<br />baths), spacious, well malntalned apts. near Havana
<br />and Mississippi. Elevators, pool and outside hallways.
<br />Grosses 5362,784. Nets 5199,163. 51,865,000
<br />(523,373/apt.). 536.93/n.r.s.f. 10.6°/: Cap -almost
<br />70.5% rashon-cash. 5.1 x Gross. 5495,000 will han-
<br />dle. Will split down payment. Mr. Shapiro: 292700.
<br />~~. ' .
<br />SALE/LEASEBACK
<br />Management-free opportunity. Owner oven 18-year-
<br />old local service business will sell and leaseback
<br />19,843 s.t. otOCe/service complex in the Englewood
<br />Industrial/business park. 5109,200/yr, for 15 years,
<br />pure net. 5910,000. Bob teino or Gordon Corn:
<br />292-3700.
<br />SUBURBAN SHOPPING CENTER
<br />Excellent 34,000+ s.f. shopping center plus new 2000
<br />s.l. 4bay car wash in small southeast community
<br />along I-25 lust north.ol Air Force'ACademy. Well
<br />melntelned and in excellent condition. Contains won-
<br />derful local tenants. Nets 5140,000• $1,400,000. As-
<br />sume 9'!.°1° loan w/owner ~Carryback. Mr. Kubby:
<br />292-3700.
<br />._-.,.
<br />~..,;~_~
<br />
<br />r
<br />FIRST TIME OFFERED -
<br />Super nelghbarhood shoppette in the heart of Woodmar Village (9083 W. Peakview Dr.) near Southwest
<br />Plaza in southwest Littleton. Center has 11 tenants including gas station and day care center, 92-car
<br />parking. $890,000 with NOI of 5728,062 with excellent assumable loan or refinancing. Mr. Rehkow:
<br />292-3700.
<br />OWNER-USER INV.
<br />Price reduced to 5850,000 for 23,432 s.f. office
<br />building with great access and 112 parking spaces for
<br />user or investor ei 2525 W. Alameda. 10.5% cap rate.
<br />Approxlmatety 3000 s.f. avalleble for lease at 510/s.l.
<br />with Immediate dccupency. Mr. Brougham: 292-3700.
<br />FULLY LEASED -RETAIL
<br />Neat, small, retell investment opportunity in old town
<br />Edgewater, 2 blks. W. of Sheridan 8 Sk>ans lake on
<br />W. 25th Ave. Bldg. has 4 retail stores for a total of
<br />4800 s.f. -fully occupied. Renovated in 1990, pride
<br />of ownership bldg. 5247,000. 9.5%Cap.
<br />Mr. Brougham: 292-3700.
<br />SOLID INCOME
<br />From this 3-tenant building. Tenants have occupied
<br />for 8, 14 and 19 years and have renewed their leases.
<br />8500 s.f., 530,102 net operating income. 5312,500.
<br />M r. IfJ ri g ht: 292-3700.
<br />SELF-SERVE CARWASH
<br />popular brick, Carwash and excess land at 85th and
<br />Huron near K-Mart end King Soopers shopping cen-
<br />ters. Great possibility for addlttonal automotive relat-
<br />ed or retell fecllitx. 5650~BO~or carwash, $700,000
<br />li M ,r~hl f i t ~' r •~ 1
<br />AURORA CAR WASH
<br />7-bay do-it-yourself car wash on Mississippi across
<br />from Buckingham Square. Traffic count over
<br />25,000/day. F~ccellent small investment with relatively
<br />tl tt le personal attention required. 5360,000.
<br />Mr, Bryant or Mr. Mitghell;~92-370p_ _ _ _ _ _ _ _~___,
<br />
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