DealZone

Ashes to ashes, dust to dust

October 9, 2008

rtx5617_comp.jpgAmid the drama of the continuing global financial crisis, the quiet death of a potential funeral home merger may have gone unnoticed.

Earlier this week, No. 1 U.S. funeral home operator Service Corp International withdrew its unsolicited bid to buy rival Stewart Enterprises for $11 per share, refusing to accept what it called Stewart’s “hell or high water” financing demands.

Service Corp had already raised its bid once, to $11 per share from its original bid of $9.50 a share.

Did Service Corp walk away too soon? Stewart, which said it was “surprised and disappointed” by Service Corp’s decision, said it would work with advisor Goldman Sachs to assess alternatives and that it remained open to further talks with Service Corp.

Stewart traded at $5.26 on Thursday — roughly half the price of the Service Corp offer.

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