Technitrol raises bid for Bel Fuse

The testy and, so far, one-sided mating dance between electronics parts makers Technitrol Inc. and Bel Fuse Inc. continued yesterday as Technitrol raised its bid for its smaller rival.

In a public release that included letters from Technitrol and Bel Fuse officials, Technitrol said it was increasing its offer to $43 per share, or $514 million, in cash from $40.30 per share. The Trevose company said it could include Technitrol stock if Bel Fuse wants.

The latest bid represents a premium of 48 percent for the Class A and 29 percent for Class B closing prices on March 22, according to a letter, dated yesterday, from Technitrol's chairman and chief executive officer James M. Papada III to Bel Fuse's president and chief executive, Daniel Bernstein. March 22 was the day before Technitrol's previous offer was announced.

In yesterday's letter, Papada said the new offer would be withdrawn on April 25 if Bel Fuse had not agreed by then to meet on April 26 or April 27 to discuss the purchase.

Bel Fuse, of Jersey City, N.J., rejected Technitrol's March offer, saying it significantly undervalued Bel's stock. Two bids by Technitrol last fall also were for $40.30 and were rejected.

Colin Dunn, chief financial officer at Bel Fuse, yesterday said only that the board would review the offer and discuss it with the company's investment bankers. "We'd always look at any offer," he said.

David Stakun, head of communications for Technitrol, said the two companies make similar products, often in China, and share many customers. The result, he said, is "shareholder capital that's being used in a duplicative way. . . . Together, we could offer an expanded product line for a broader base of customers more efficiently."

In the letter, Papada said the acquisition is in the best interest of Bel Fuse shareholders. "It is our opinion that Bel Fuse has not seriously evaluated or considered what is in the best financial interests of all of its shareholders," he said.

In an April 20 letter about the proposed merger to two Technitrol directors, two members of the Bel Fuse board, Avi Eden and Peter Gilbert, said Bel Fuse is in the "late stages of an acquisition" that will be its focus for the next few weeks.

They also said Technitrol would have to offer substantially more than its previous bids. "Bel is a profitable company with considerable cash reserves and numerous alternative opportunities," they said.

Last year, Bel Fuse reported a profit of $25.2 million on revenue of $254.9 million. Technitrol earned $57.2 million on revenue of 954.1 million.

Technitrol shares fell 43 cents to $27.12 yesterday. Bel Fuse Class A shares rose 95 cents to $39.47, while Class B shares gained 64 cents to $39.88.