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cash.4 At that time, JMSL was owned through a Delaware holding
company, PST Acquiring Corp. (PST), which was owned 50 percent by
the members of the Jacobs Group and 50 percent by Kalmanovitz.
Petitioner's shares were trading on the New York stock exchange
at approximately $20 per share.
In response to the Second JMSL Offer, petitioner and
Heileman entered into an agreement in principle on November 5,
1982, as later amended on November 9 and 26, 1982 (Agreement in
Principle). The Agreement in Principle was the product of
arm's-length negotiations between petitioner and Heileman. As
originally drafted, the Agreement in Principle contemplated the
following transaction: (1) Heileman's acquisition of petitioner
and Olympia by way of a merger, (2) Heileman's retention of
certain assets of petitioner and Olympia, and (3) a spinoff of
the remaining assets to a new entity of which Heileman would not
be a shareholder. To effectuate the merger, the Agreement in
Principle provided that Heileman, through a wholly owned
subsidiary, would make a cash tender offer to acquire
petitioner's stock.
On November 10, 1982, pursuant to the Agreement in
Principle, Heileman commenced a tender offer (First HBC Offer)
through its wholly owned subsidiary, HBC Acquisition, Inc. (HBC),
4 The 3 million shares, when combined with the shares the
Jacobs Group already owned, constituted a controlling interest in
petitioner.
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