G.C. Murphy Co., in a joint announcement with Ames...

MCKEESPORT, Pa. -- G.C. Murphy Co., in a joint announcement with Ames Department Stores Inc., announced Tuesday it has agreed to be acquired by Ames for $48 per share in cash.

The boards of directors of both companies unanimously approved the transaction and a definitive merger agreement has been executed, the announcement said.


G.C. Murphy, headquartered in McKeesport, near Pittsburgh, has 383 stores in eight states. Ames, based in Rocky Hill, Conn., operates 185 discount department sotres in 11 northeastern states.

Ames began talks with G.C. Murphy April 15 concerning its intention to acquire 100 percent of the chain of discount stores.

At present, Ames owns or has options to acquire approximately 34 percent of G.C. Murphy's common stock. One such option, granted by G.C. Murphy as part of the proposed transaction, consists of an option to acquire 786,000 newly issued shares. The option is exercisable, under certain conditions, at $48 per share.

Ames will commence a tender offer later this week to acquire any and all shares of G.C. Murphy common stock at $48 per share, net to the seller in cash.

The offer will not be subject to any minimum number of shares being tendered, the announcement said, and Wertheim & Co. will act as dealer manager.


At the time of Ames' original overture, G.C. Murphy's management had been considering a $175 million leveraged buyout. Holders of G.C. Murphy stock last June approved two measures proposed by company management to make hostile takeover bids more difficult following a spirited proxy fight with New Jersey investor Arthur Goldberg.

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