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Shortly after decedent’s death, representatives of the
estate inquired of Reliance’s management whether they were aware
of any investors who might be interested in purchasing some of
the estate’s Reliance shares. Reliance’s management, on behalf
of the estate, asked Reliance’s investment banking firm (DLJ) to
try to identify private institutional or strategic investors who
might be willing to purchase a significant block of the estate’s
Reliance shares. DLJ made some inquiries in this regard but was
not able to identify an interested investor for the estate’s
Reliance shares. At that point, members of the Reliance board of
directors began discussing the possibility of Reliance
repurchasing some of the estate’s Reliance shares.
Hannah approached the estate’s attorney and told him that
Reliance’s management may be willing to approve Reliance’s
repurchase of some of the estate’s Reliance shares. Hannah
explained to the estate’s attorney that Reliance’s management
would have to evaluate any repurchase in light of the pending
company acquisition, the possible need and ability to obtain
additional financing, and the impact of a leveraged repurchase on
Reliance’s financial ratios.
Eventually, at an October 18, 2000, meeting, Reliance’s
board of directors (with Thomas excused) approved the repurchase
of up to $50 million worth of the estate’s Reliance shares at
$19.35 per share. The record is not clear as to how Reliance’s
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Last modified: May 25, 2011