United Technologies Corp. is asking its shareholders to ignore a recent mini-tender offer from a company that’s become notorious for trying to buy shares below their market value.
TRC Capital Corp. has offered to purchase up to 1 million shares of UTC stock — about one tenth of one percent of outstanding shares — for $108.85 each. That’s more than 4.5 percent lower than the market closing price of $114.04 on Dec. 11 — the day before TRC’s offer commenced, according to UTC. The offer expires Jan. 13.
Mini-tender offers are not illegal, but the U.S. Securities & Exchange Commission says the offers can catch investors off guard. They are often lower than market price, but shareholders are sometimes tricked because they assume that the price offered includes a premium, like larger tender offers usually do.
Bidding for less than 5 percent of a company’s shares excludes the bidder from offering certain shareholder protections, such as withdrawal rights, according to the SEC.
UTC has asked any shareholders who tendered shares to TRC to try to withdraw them.
TRC Capital, based in Toronto, has made similar offers to many public companies over the years, including Cheshire’s Alexion Pharmaceuticals and Danbury industrial gas giant Praxair.
UTC shares were trading at $116.51 around 10 a.m. Monday.
