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Sunbeam allays Perelman
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August 13, 1998: 7:46 a.m. ET
Appliance maker gives former Coleman owner bigger stake
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NEW YORK (CNNfn) - In return for legal protection, financially troubled Sunbeam Corp. is giving the former owner of Coleman Co. a larger stake in the company.
The appliance maker, which ousted its controversial chief executive in June amid an accounting controversy, said it will issue MacAndrews & Forbes Holdings Inc. five-year warrants to buy an additional 23 million in Sunbeam shares at an exercise price of $7 per share.
MacAndrews & Forbes, controlled by financier Ronald O. Perelman, sold 82% of Coleman Co. to Sunbeam in February in a deal that included about 14 million Sunbeam shares.
The value of those shares, however, fell dramatically after Sunbeam disclosed accounting irregularities and said it would revise past earnings reports and lower forecasts going forward.
In return for the Sunbeam warrants, MacAndrews said it would drop all legal claims against the company and allow Sunbeam to retain the MacAndrews management team that has helped to steer the company since the ouster of CEO 'Chainsaw' Al Dunlap
Dunlap, nicknamed for his penchant for layoffs, was fired for failing to deliver on promises to boost earnings.
MacAndrews will allow Sunbeam to retain Jerry W. Levin, a MacAndrews & Forbes executive and longtime aide to Mr. Perelman, as its chief executive.
Levin and Bobby Jenkins, MacAndrews' chief financial officer, will sign three-year employment agreements with Sunbeam.
"We are fully committed to helping Sunbeam succeed," the company quoted a MacAndrews official as saying. "Our interests are aligned with all other Sunbeam shareholders because these warrants will only have value if Sunbeam shares appreciate from current levels."
Sunbeam has postponed its financial reporting for the quarter ended June 30 in efforts to straighten out its books. The results will be released next month.
Shares of Sunbeam Corp. (SOC) gained ¼, or nearly 4 percent, to 6-7/8 at the close of the New York Stock Exchange Wednesday. The company's shares are down dramatically from its high of 53 per share set in late March. 
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Sunbeam
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