Giant U.S. cable maker Belden Inc. has extended its hostile bid for Canada's RuggedCom Inc. , a manufacturer of communications equipment for harsh environments.
Belden said Monday its $22-per-share offer, which was to expire on Jan. 25, will now stay in place until Feb. 9. It has done this to let shareholders see the outcome of an Ontario Securities Commission hearing into the poison pill that RuggedCom established to block the offer.
The OSC hearing into Belden's request that the poison pill be cease-traded is set for Feb. 6.
"We are confident that the Ontario Securities Commission will side with RuggedCom shareholders and allow them to make their own decisions about the merits of Belden's offer," Belden president John Stroup said in a statement.
Belden first made its bid for RuggedCom on Dec. 19. It wants to beef up its networking business in the electric power transmission and transportation sectors.
RuggedCom, based in Concord, Ont., just outside Toronto, makes switches and network routers that are designed for messy places, such as power substations, oil refineries and roadside traffic control boxes. With clients around the world, its revenues have climbed steadily to about $100-million a year. The company has also carved out a niche in the "smart grid" business – the real-time control and monitoring of electrical transmission networks.
RuggedCom shares have been trading well above the Belden offer, indicating that shareholders believe a higher offer is coming. RuggedCom's board has rejected the Belden offer and has encouraged other potential suitors to look at its books.
Last month RuggedCom put in the place the shareholder rights plan that would allow its board to double the number of shares outstanding if someone acquires more than 20 per cent of the company's stock.