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Tendered Castle
shares include
Gates’ stake

But Murdock still needs
at least another 2.3 million
shares to put the deal through

By Russ Lynch
Star-Bulletin

Multibillionaire Bill Gates already had offered to sell his 1.07 million Castle & Cooke Inc. shares to David H. Murdock by the time the Microsoft Corp. chairman's holding in the real estate development company was first disclosed yesterday, Dean Estrada, a Castle & Cooke spokesman, said today.

Gates' 6.3 percent holding, worth $20.6 million at Murdock's proposed price of $19.25 a share, was included in the 7.1 million shares that Murdock had been offered when shares were counted Friday, Estrada said.

When the Gates holding was disclosed in a Securities & Exchange Commission notice filed yesterday, it raised a lot of speculation about his intentions.

The filing showed only that Gates' personally owned investment firm, Cascade Investment LLC, had built up a Castle & Cooke holding that on June 28 had passed the 5 percent level that requires public disclosure. There was no information about when Gates bought the shares or what he paid for them.

Estrada said that a holding by the investment firm Ingalls & Snyder LLC of 1.04 million shares also had been tendered before Friday's share count. That 6.1 percent holding, therefore, also doesn't affect the result that was announced yesterday.

Estrada said articles in the financial media had indicated that the Ingalls & Snyder and Gates holdings might make a difference by the new deadline, midnight this Friday New York time, but that is not so because they already have been counted.

Murdock and other Castle & Cooke executives, including Estrada, are on Lanai for today's previously scheduled regular meeting of the company's board of directors.

Before the latest deadline extension, Murdock's $19.25 offer had been accepted by holders of about 42 percent of the shares. On top of the 27 percent he already owns, that would give Murdock about a 69 percent holding.

However, there is also a condition in his offer that could halt the deal if he doesn't get at least another 2.3 million shares, which would bring his total Castle & Cooke holding to about 86 percent of the company. Estrada said that if Murdock doesn't have that many shares by the Friday deadline, his options include dropping his bid or asking for a waiver to allow him to accept and pay for whatever shares have been tendered.

Shareholders who have not tendered their shares by then could seek a court-ordered appraisal in hopes of getting a higher price.