Buyout or Sellout?

by louabbott on May 15, 2008

Motley Fool – Published May 15, 2008

Tell me if you’ve heard this one before: A troubled company’s founder makes a bid to take the company private, temporarily inflating its share price, but ultimately never follows through. He then does the same thing again in the future, once more temporarily boosting his stock’s worth. No, we’re not talking about Parlux Fragrances (Nasdaq: PARL), though majority owner Ilia Lekach has USANA Health Sciences, which is once again enjoying a surge in its stock price thanks to the ruminations of its founder Myron Wentz, who already owns 68% of the company. This marks the second time he’s expressed an interest in taking the company private.

USANA has weathered numerous allegations, most notably from Barry Minkow — a stock trader, previously convicted of fraud, who founded the Fraud Discovery Institute after his release from prison — who charged the MLM firm with running a pyramid scheme. The SEC investigated the accusations but ultimately closed its books without taking action.

Read the entire article at The Motley Fool

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