AZUSA, Calif. (AP) -- Physicians Formula Holdings Inc. has rejected a buyout offer from the private equity firm Swander Pace Capital in favor of a higher bid of about $74.9 million from Markwins International Corp., a privately held cosmetics company.
Physicians Formula, based in Azusa, Calif., said Thursday that Markwins will acquire all of its outstanding shares for $4.90 per share, which represents a 33 percent premium to the company's closing price of $3.68 on Aug. 14, the last trading day before the company entered into a merger agreement with Swander Pace.
Physicians Formula had accepted an offer from Swander Pace worth $4.20 per share, or about $65 million. That represented a 14 percent premium to the Aug. 14 closing price. But the company ended that deal and will pay Swander Pace a termination fee of nearly $1.3 million.
Physicians Formula's board unanimously approved the Markwins deal, which is expected to close later this year. Physicians Formula had said earlier this month that it had received a new, unsolicited buyout proposal from a suitor it did not identify offering to buy the company for $4.90 per share.
Physicians Formula is a cosmetics and skin-care company with products sold in more than 25,000 stores, including those operated by large chains like Wal-Mart Stores Inc. and CVS Caremark Corp. Markwins International is based in Industry, Calif., and specializes in color cosmetics, cosmetic accessories and beauty collections.