Nathan's Famous share prices rise in buyback
Nathan's hot dog Credit: Newsday, 2010 / Erica Marcus
Nathan's Famous Inc.'s stock price rose sharply after an offer to buy back up to a half-million of its own shares and to pay a premium of as much as $3 a share.
The buyback takes the form of a Dutch auction, in which shareholders can tender their shares to Nathan's at prices ranging from $20 to $22 per share. The company will buy as much as 10 percent of its nearly 5 million shares outstanding.
The Jericho-based hot dog maker and restaurant operator made the offer Monday, saying it will spend up to $11 million. The offer period begins Thursday and ends Jan. 12.
The company's stock closed at $19.08 on Monday on the Nasdaq exchange, and Nathan's made the offer after the market closed that day. The shares reached a closing price the next day of $20.99. By midafternoon Wednesday, the price hovered at about $21.10 per share.
Famed for its beef frankfurters, Nathan's first restaurant opened in 1916 in Coney Island.
With about 220 workers and a market capitalization of $104.8 million, it had $4.2 million in income on $61.64 million revenue during the past four fiscal quarters.
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