Ceridian's buyout hits a speed bump

Posted Jun 13th 2007 5:50PM by Tom Taulli
Filed under: Private Equity

This week, the $5.3 billion buyout of Ceridian (NYSE: CEN) has gotten a lot more complex. The company's biggest shareholder, Pershing Square Capital Management, is not happy about the price tag.

More and more, private equity deals are coming under attack by activist shareholders. Then again, it tends to be an effective strategy.

As for Pershing, it has hired the investment bank, Lazard (NYSE: LAZ), to help things out.

Pershing's William Ackman has written a letter to Ceridian shareholders. Basically, he is going to seek out other suitors for the company (including strategic buyers and private equity firms). He would even be amenable to a big-time dividend or a spin-off of non-core divisions.

All in all, Ackman is just trying to get a higher price.

But it didn't have much of an impact. For the day, Ceridian's stock price was up $0.16 to $35.37. The proposed buyout price is $36.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Tags: CEN, Ceridian, LAZ, Lazard, Pershing Square Capital, PershingSquareCapital