Up Front: HONCHOS
PRIDE GOETH BEFORE A BOTCHED BUYOUT
IT'S NOT EVERY DAY YOU GET a corner-office mea culpa. That's what Richard Bernstein, CEO of Western Publishing, has delivered to investors in the company's just issued annual report. He says he wasn't fair to them in a failed buyout of the company by former Simon & Schuster chief Richard Snyder and investment house Warburg Pincus. Analysts say the deal collapsed in October at least partly because of shareholder distress over how it favored Bernstein.
In the report, Bernstein writes that his "pride and vanity" allowed him to push a deal "in which I would be treated differently from" other shareholders. He says any future deals will treat all shareholders equally.
Western, publisher of the classic Golden Books (Tootle, The Poky Little Puppy) beloved by children, has had a rocky financial history of late due to fierce competition. Snyder and Warburg Pincus offered to buy Bernstein's 20% stake in the company at $15.50--a $2 premium over the market price. Other shareholders, though, were not allowed to tender their stock.EDITED BY LARRY LIGHT, WITH PAUL ENG