Mace Security International Inc., of Mount Laurel, said yesterday that it rejected a $3-a-share buyout offer from Kelly Capital Management L.L.C., but was holding talks for a possible higher offer from the investment firm.
Mace asked investors for patience, saying that once its car-wash chain was liquidated, Mace would be in an "ideal position to grow its security business," or pursue other opportunities.
Company spokesman Eduardo Nieves Jr. said yesterday that Mace believed the company was worth more than $3 a share because of the "famous Mace brand, the direction we're going, and the sale of the car washes."
Mace, which had plans earlier this decade to grow into the nation's largest car-wash chain, has an agreement to sell 12 car washes in Arizona and is seeking buyers for 28 car washes in Texas, Florida and the Northeast, Nieves said.
He said Mace did not have a timetable for selling the car washes.
In recent years, Mace has tried to grow its surveillance and security businesses, which include the Mace pepper spray. The security business generates about $23.5 million a year in sales.
Mace has developed new marketing strategies and intends to roll out new products in 2007, Nieves said.
At the same time, Kelly Capital, which is run by San Diego investors and brothers Michael and Richard Kelly, has signed a confidentiality agreement with Mace to look into its books to determine whether it could boost its $3-a-share offer, Mace said in a statement.
Repeating an earlier position, Mace said its book value was $3.78 a share in September 2006. Per-share book value is common shareholders' equity divided by the number of outstanding shares. It is an accounting measure not closely followed by investors in nonfinancial companies.
Mace Security said that if it sold its remaining car washes at projected prices, it would have close to $3 a share in cash.
Mace shares rose 8.7 percent, or 23 cents, to $2.88 a share in trading yesterday on the Nasdaq Stock Market.