TSR Inc. receives takeover bid from a shareholder, QAR Industries, filing shows

QAR Industries is bidding to buy TSR Inc., a Hauppauge-based staffing company, according to an SEC filing.

Mineral Wells, Texas-based QAR, which owns about 7 percent of TSR's stock, is offering $6.25 per share for the rest of the company. 

TSR shares rose nearly 14 percent to $5.31 on Tuesday after the bid was disclosed. They fell 3.4 percent to close at $5.07 Wednesday; then jumped 19 percent to $6.04  in after-hours trading.

QAR, a maker of broadcast and communications equipment, made the bid to the board rather than directly to shareholders.

QAR criticized TSR's board in a letter dated Nov. 14 that was contained in the SEC filing that made the bid public.

"Not to be inflammatory, but we strongly disagree with the Board of Director's recent actions and fully believe a cash offer is a better choice for the company's shareholders than for them to see their rights as shareholders eroded," QAR wrote.

TSR enacted a shareholder rights plan, called a "poison pill" in Wall Street parlance, after QAR, Zeff Capital LP of Manhattan and Fintech Consulting LLC of Iselin, New Jersey, acquired 41.8 percent of TSR's stock in the summer. A shareholder rights plan seeks to fend off hostile acquisition attempts by threatening to dilute the holdings of unwanted suitors.

QAR added that "we believe that as a private company," TSR can better focus on its customers than as a publicly traded company. 

TSR chief executive Christopher Hughes said the company had no comment. QAR President Robert Fitzgerald didn't immediately return a call seeking comment.

QAR, Zeff and Fintech acquired TSR shares when Joseph and Winifred Hughes, the retired founder and former chief executive of TSR and his wife, sold their 41.8 percent stake in the company to them for $5.1 million.

The three investors now own more than 48 percent of the common stock, according to data from Bloomberg.

The Hugheses sent a letter to the board of directors in June, before they sold their shares, calling for TSR to be sold. 

TSR turned down a previous takeover bid by Zeff Capital in May 2017.

TSR, founded in 1969, has offices in Hauppauge, Manhattan, and Edison, New Jersey, and provides IT staffing services to the utility, insurance, publishing, pharmaceutical and financial services industries.

The company had 417 employees as of May 31, according to the filing.