Vestin Group board appoints panel to evaluate privatization

Kevin Rademacher

Tuesday, Dec. 23, 2003 | 11:05 a.m.

Additional details about Vestin Group Inc. Chief Executive Michael Shustek's move to take the company private are emerging.

The company's board of directors has appointed a special committee composed of independent directors to evaluate any proposal submitted by Shustek. The committee, company officials said on Monday, is expected to retain outside counsel and an investment banking firm to represent it during the process.

The board announced on Monday that is had been notified of Shustek's intention to buy the outstanding shares he doesn't already own. A formal offer from Shustek for the purchase of the shares is expected during the first quarter of 2004. The deal could be completed by mid-year, company officials said.

Ultimately, any offer would have to be approved by a vote of the Vestin Group board of directors and be subject to the approval of federal regulators. The Vestin board was reduced to five from 10 members at a shareholder meeting last month.

A company spokesman said the move by Shustek was driven by the rising costs incurred by publicly traded companies in the wake of increased regulatory scrutiny.

Shustek already owns 3.2 million shares in the company, about 60 percent of the 5.3 million outstanding shares, according to recent filings with the Securities and Exchange Commission.

Directors and executive officers in the company control more than 76 percent of Vestin's stock, including Shustek's shares and outstanding options to purchase additional shares.