The Harvey acquisition of MyerEmco announced in May has been called off. The merger—which was supposed to have closed by June 7, later extended to the end of July, and then pushed back to August 10—called for Harvey to pay $10 million in cash and assume MyerEmco's debt.
The merger announcement was a surprise, since MyerEmco was seen as a successful regional chain and wasn't actively being shopped. Jon Myer, CEO of the chain, told TWICE that any business "is on sale for the right price." Trinity Investment Partners, Harvey's parent company, apparently had trouble coming up with that price, although most industry observers see that as a result of the tightening credit crunch rather than indicative of a more specific cause.
If that's the case, look for more announcements terminating highly leveraged takeovers, not just in audio, but everywhere.
Myer told TWICE's Alan Wolf, "This just dragged on too long. … I had mixed feelings about selling the family business. It felt weird."
Michael Recca, Harvey's interim CEO, withheld comment pending an SEC 8-K filing on August 16. Examinations of that filing reveal primarily that the merger talks were expensive for both sides. The letter of extension filed by both parties that moved the closing to July 23 agreed that Harvey would pay MyerEmco $300,000 in a "first extension fee." The second delay was accepted for a "fee not to exceed $50,000" for legal and accounting fees. Although MyerEmco stated that it had spent over $350,000 in legal and accounting fees on the merger, according to the 8-K filing, it was "willing to accept payment in the amount of $14,500 in satisfaction of Harvey's obligation to pay the second extension fee."
