UPDATE 1-Pre-Paid Legal weighs $592 mln buyout offer from PE

* $60/shr offer, a 7 pct premium

* Reports 46 pct increase in Q3 net income

* Stock up as much as 14 percent

Oct 25 (BestGrowthStock) – Pre-Paid Legal Services Inc (PPD.N: ),
which offers legal services for a monthly fee, said it was
evaluating a $592 million buyout offer from an unnamed private
equity firm.

The proposal from a “well known” private equity firm values
the company at $60 per share, a premium of 7 percent over the
stock’s Friday close of $56.14.

Deals from private equity firms have risen sharply in
recent months, with funds under pressure to spend amid talk of
potential looming tax increases.

As of late-September, such deals totaled $140.5 billion,
more than double the year-earlier volume. [ID:nN22232960]

Pre-Paid said it does not intend to disclose any
developments regarding the process unless and until a special
committee formed to evaluate the offer has made its decision.

The committee has retained Berenson & Co LLC to act as its
financial adviser.

Pre-paid Legal provides legal service benefits plans
through a network of independent law firms across the United
States and Canada.

Separately, the company also reported
stronger-than-expected quarterly profit, helped by a 21 percent
fall in commissions paid.

Net income for the third quarter was $15.9 million, or
$1.61 a share, compared with analysts’ expectations of $1.35
per share, according to Thomson Reuters I/B/E/S. [ID:nASA00VNT]

Shares of the Ada, Oklahoma-based company were trading up
13 percent at $63.35 in early morning trade on the New York
Stock Exchange, making the stock the second biggest percentage
gainer on the exchange.
(Reporting by Sweta Singh in Bangalore; Editing by
Unnikrishnan Nair)

UPDATE 1-Pre-Paid Legal weighs $592 mln buyout offer from PE