(By Balachander) Johnson Controls Inc. (NYSE:JCI) has recommended rejection of an unsolicited "mini-tender offer" by TRC Capital Corp.
The Milwaukee, Wisconsin-based provider of batteries for automobiles and hybrid electric vehicles said TRC's offer price of $1.33, or roughly 4.94 percent, is below the company's current market price.
TRC has offered to purchase up to 4 million shares, or around 0.58 percent, of Johnson Controls' stock at $25.60 per share.
Mini-tender offers are third-party offers that seek to acquire less than 5 percent of a company's outstanding shares.
The U.S. Securities and Exchange Commission (SEC) has issued an investor alert regarding mini-tender offers. The SEC has noted that, in making the offers at below-market prices, "bidders are hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price."
Johnson Controls recommends that stockholders not tender their shares in response to TRC's unsolicited mini-tender offer.
The company said it is not associated in any way with TRC Capital, its mini-tender offer or the offer documentation.
The company urges investors to obtain current market quotations for their shares of common stock, to consult with their financial advisors and to exercise caution with respect to TRC's offer.
The offer is currently scheduled for 12:01 a.m., New York City time, on Thursday, September 27, 2012.
JCI shares, which have been trading in the 52-week range of $23.37 to $35.95, ended at $27.19 on Friday.