Improved offer for SMF

A US electronics firm, based in Shannon, is offering shareholders at troubled SMF Technologies four times the price offered for the company from its own management.

Connor-Winfield Ltd last week submitted a proposal to buy SMF for €200,000 and assume its debt of €186,000 to an existing director.

SMF, which manufactures electronic measuring equipment, had been considering a €50,000 offer from managing director Mr John McDonnell.

The company decided to accept a proposal from Mr McDonnell and consultant Mr Gary Carroll for the company after a failure to raise finance to fund an acquisition earlier this year led director Mr Michael O'Donoghue to withdraw his financial support. This support had been underpinning the company in recent years.

The move led to the resignation of the company's Irish stock market sponsor and a decision by the company to seek a sudden delisting from the Irish Stock Exchange.

Connor-Winfield's proposal to the SMF board will mirror the structure of the existing management buyout (MBO) bid, which wants to buy the trading subsidiaries of the group. It would avoid the time and cost involved in buying a listed company.

This would leave a shell company and the SMF board has already received approaches from a number of companies looking to use that for their own purposes. Under the MBO, the shell would have cash assets of just €10,000. The Connor-Winfield approach would increase this to about €160,000.

SMF chairman Mr Bill Henebry last night said the board would consider any offer that is submitted. "Whatever we have will be put in front of the extraordinary general meeting," he said.

This meeting will be held on July 8th.