Steel Partners Offers $980 Million to Acquire InMode and Oust CEO Moshe Mizrahi

American holding company Steel Partners Holdings has submitted a letter to the board of Israeli medical aesthetics firm InMode proposing to acquire the company at $16.75 per share, valuing it at approximately $980 million. This offer represents a 15.8% premium over InMode's closing price on Wednesday and initiates a new control battle for the company.

Steel Partners, a long-time shareholder, demands the immediate removal of InMode's founder and CEO Moshe Mizrahi, calling for an independent committee to evaluate its acquisition proposal. The firm claims its offer is superior to Mizrahi's own recent bid and accuses him of a disappointing strategic process involving alleged market expectation manipulation and company valuation distortions. They question whether the board will fulfill its fiduciary duties by accepting a better offer or allow insiders to buy the company at an inadequate price.

The letter also raises concerns about conflicts of interest, lack of independence in the board's review committee, and potential violations of securities and Israeli corporate laws. This is Steel Partners' second letter to InMode's board within a week, following earlier objections to Mizrahi's acquisition proposal. Warren Lichtenstein, who manages Steel Partners, signed the letters.

Earlier this year, InMode initiated a sale process that attracted bids from two groups: one led by Mizrahi and businessman Meir Shamir, and another from Korean private equity firm Centroid. The board rejected both offers despite their higher valuations compared to current proposals. The ongoing control dispute could potentially drive up the acquisition price.

InMode has not publicly responded to Steel Partners' letters so far.