Cornell shareholder filing states Veritas' merger consideration of $18.25 per share is inadequate

By Lisa Kerner

Charlotte, N.C., Jan. 17 - Veritas' merger consideration of $18.25 per share for Cornell Cos. is considered inadequate by Wynnefield Partners and its affiliated reporting persons, who own about 2.5 million, or 17.5%, of the company's outstanding shares.

A more fair price would be $26.16 per share based on Cornell's 2007 EBITDA and Wednesday's closing price, according to a schedule 13D filed with the Securities and Exchange Commission.

Cornell shares (NYSE: CRN) closed at $18.74 on Wednesday.

Wynnefield asserts in the filing that "it is in the best interest of shareholders that Cornell remains an independent, publicly traded company."

The reporting persons are asking Cornell to provide updated projections that "reflect the actual value of Cornell" as well as updated financial projections including growth opportunities.

Houston-based Cornell provides correction, detention, education, rehabilitation and treatment services.

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