NEW YORK, JUNE 1 -- An investor group led by Coniston Partners said today it would continue its attempt to gain control of Allegis Corp., despite the travel conglomerate's recapitalization plan aimed at thwarting the takeover.
The investor group, which controls 13 percent of the Allegis common shares outstanding, indicated last week it was attempting to solicit shareholder consents to win control of the board of directors.
Allegis last week said it planned to borrow $3 billion, more than doubling its outstanding debt, in order to pay shareholders a special $60 a share cash dividend to thwart the takeover.
"The group intends to review the advisability of the company's proposed recapitalization plan as further details concerning the plan are announced," Coniston stated.
"The group intends to consider the same or a similar plan as a first step in its previously announced plan for a more complete restructuring of the company."
Coniston stated that it planned to sell "or otherwise dispose of" Allegis assets to pay down debt, to make possible further distributions to shareholders and to strengthen the company's business and financial standing.
In initially announcing its takeover attempt, the Coniston group said it planned to sell all or some of Allegis' major assets, which include United Air Lines, Hertz auto rental, and the Westin and Hilton International hotel chains. Coniston has stated it believed Allegis would be worth more if split into separate companies.
Allegis shares fell $1.37 1/2 a share to $85.12 1/2 today in active New York Stock Exchange trading.