March 7 (Reuters) - A shareholder group of Ferro Corp said the chemical maker should explore selling itself, criticizing its rejection of A. Schulman Inc's $563 million buyout offer.
The group, headed by investors FrontFour Capital Group LLC and Quinpario Partners LLC, owns about 3.71 million shares, or a 4.3 percent stake, in Ferro. Ferro had 86.55 million shares outstanding as of Feb. 28.
"While we do not believe the offer fully values Ferro, the manner in which the Ferro board summarily rejected the offer without appearing to have engaged A. Schulman and attempting to negotiate a higher price speaks volumes," the group said in a letter to fellow shareholders.
A. Schulman on Monday offered $6.50 per share, and said it could adjust its offer if it gets the chance to inspect Ferro's books.
The group, which has nominated three directors to Ferro's board, wants the company to explore a sale to A. Schulman or any other potential acquirer "at a price that fully and fairly values the company."
Ferro said on Tuesday it would sell assets that do not generate sufficient returns and review its product lines, re-iterating its rejection of Schulman's offer.
The shareholders said the company's realignment of its business segment reporting was confusing to shareholders.
They also criticized Ferro's earnings call, where the management did not take questions from analysts and investors.
Ferro shares, which have risen about 32 percent since A. Schulman's offer, closed at $6.84 on Wednesday.