Arrow International
(NDAQ:ARRO) shares jumped $5.98, or 18.21%, to $38.82 today after the
company announced that it formed a special committee to explore
strategic alternatives. The company hired investment banking firm
Lazard Freres & Co. to assist them in connection with the review.
Interestingly,
Richard Niner, who resigned from the company's board on May 4th,
commented, "For the last several months the board, in fits and starts
and in a clandestine manner led by its four founders, has been pursuing
a sale strategy for the company. The strategy, I believe, is being
pursued at the wrong time, for the wrong reasons and in the wrong way."
The
comments gave merit to speculation that the company was considering
putting itself up for sale as opposed to exploring other internal
strategic options. Given the apparent support by the board of directors
and shareholders (evidenced by today's spike) it's safe to say that a
sale is a strong possibility provided there are willing buyers. The
high buyout premiums we've been seeing recently are also very
attractive for opportunistic investors.
Arrow said it does not
plan on providing updates or making further comment until the outcome
of the process is determined or until there are significant
developments. Moreover, the company has set no timetable or guarantee
that the company will pursue any strategic options.
Despite
Niners objections to the company putting itself up for sale, this is
clearly the direction in which the board is heading. This makes ARRO a
stock
worth watching!
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