Steven Madden shares up on acquisition talk; Platinum Equity buys Ryerson; Tyco stock falls

By Sheri Kasprzak

New York, Oct. 19 - Shares of shoe designer Steven Madden, Ltd. were up Friday on news that the company is seeking strategic alternatives, including a possible sale of the company to a third party.

The company has already been approached by third parties regarding a potential acquisition, a statement from Steven Madden said.

The news comes just days after Steven Madden announced weaker-than-expected third-quarter sales. The company reported that it expects full-year sales to be down 9% to 11%, higher than its previously expected 7% decline from 2006.

A sellside trader said Friday that if the company is experiencing lackluster sales, a move like this will likely save it from falling any faster.

"I imagine they're looking for a safety net," said the trader. "Stock is looking great today, so I think they're probably in serious talks."

In other merger news, Platinum Equity, LLC sealed its acquisition of Ryerson Inc.

Platinum bought all of Ryerson's common shares and series A cumulative convertible preferred stock at $34.50 each.

Elsewhere, electronics giant Tyco Electronics Ltd. is selling its Power Systems business to private equity firm The Gores Group, LLC in a $100 million cash deal.

The news sent shares of Tyco down 1.74% on Friday.

North of the border, Mercator Minerals Ltd. is making a bid for Tyler Resources Inc.

Steven Madden merger talk

Moving back to Steven Madden, the company said Friday it has received inquiries from third parties for a possible acquisition.

The company has hit a slump in terms of earnings, according to recent news, experiencing earnings that were less than what was expected in the third quarter, which will likely mean year-end earnings will be 9% to 11% less than for 2006.

In pre-market action, the stock was up almost 14%. The shares went on to gain 11.93%, or $2.35, to end at $22.04 (Nasdaq: SHOO).

A trader said Friday that the move in shares speaks to the potential benefits of the potential merger.

Steven Madden said in a statement released Friday that its board of directors is seeking "strategic alternatives" and has formed a strategic review committee.

"The company does not expect to disclose further developments regarding the process until the review of strategic alternatives has been completed," the statement said.

Platinum Equity wraps Ryerson purchase

Elsewhere in merger activity, Platinum Equity bought out Ryerson in a $34.50-per-share offering.

The deal, which has been in the works since late July, was closed Friday.

Ryerson's stock was unmoved at $34.48 (NYSE: RYI).

Chicago-based Ryerson distributes and processes metals in North America.

Tyco to sell Power Systems business

Tyco Electronics Ltd. said Friday it has agreed to sell its Tyco Electronics Power Systems business to The Gores Group LLC in a $100 million cash transaction.

Tyco's stock slipped by 64 cents on Friday to close at $36.24 (NYSE: TEL).

The electronics components company plans to use the proceeds from the sale for working capital. The deal is expected to wrap up in late 2007 or early 2008.

"In anticipation of the sale and beginning in the third fiscal quarter of 2007, the Power Systems business was classified as a discontinued operation and the results of the segment were reported accordingly," said a statement from Tyco released Friday.

The statement said the sale was consistent with its strategy to "divest certain businesses in an effort to streamline its portfolio and reallocate resources to its core operations."

Tyco is based in Pembroke, Bermuda.

Mercator makes bid for Tyler

In Canadian action, Mercator Minerals voiced its interest Friday in buying Tyler Resources.

Mercator plans to pay C$1.00 per share for Tyler's stock, a 35% premium to Tyler's C$0.74 closing stock price on Thursday. In the offer, Tyler's shareholders would receive 0.113 of a Mercator share for every Tyler share.

Mercator would issue a total of 15 million shares in the deal.

"The strong merits of the proposed transaction compelled us to announce our intended offer to the shareholders of Tyler," said Mike Surratt, chief executive officer of Mercator, in a news release.

"The combination of Mercator and Tyler makes sense from a strategic and geographic perspective and we believe that the proposed combination is a creative way to unlock value for all shareholders involved.

"Despite considerable development, mining and mineral processing risk, we believe Tyler's Bahuerachi project is an excellent complement to Mercator and one that we believe our mining and mineral processing teams can see through to production. We plan to accelerate Bahuerachi to feasibility and bring it on stream very early in the next decade. Our offer could give Tyler shareholders an immediate lift and the opportunity to participate in the upside with an aggressive, growing mid-tier base metal producer."

Despite the offer, shares of Tyler were off by 3 cents Friday to close at C$0.71 (TSX Venture: TYS). Shares of Mercator closed down 9 cents at C$9.71 (Toronto: ML).

Mercator is a mineral explorer based in Vancouver, B.C., and Tyler is a base and precious metals explorer also based out of Vancouver.

Countrywide shares slide

As the Securities and Exchange Commission launched an investigation into Countrywide Financial Corp. CEO Angelo Mozilo, shares of Countrywide slid by 7.75% on Friday.

The stock gave up $1.28 to end the day at $15.23 (NYSE: CFC). The stock gained 6 cents after hours.

The SEC is turning an eye to Mozilo after the chief sold roughly $150 million in Countrywide shares even as his company spiraled into financial disaster.

Countrywide, over the past few months, has suffered following a period of major credit deterioration for subprime mortgages.

Among other mortgage lenders, Thornburg Mortgage Inc.'s stock slid by 3.07%, or 30 cents, to close at $9.46 (NYSE: TMA). Mortgage lender IndyMac Bancorp's stock dove by 93 cents, or 5.93%, to settle at $14.75, losing another 6 cents after hours (NYSE: IMB).

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