Cosmos Capital to make an offer of CDN $5.25 in cash per share to acquire
Cossette Inc.
The all-cash offer of CDN
The Offer is not subject to any financing conditions, as Cosmos has obtained all the necessary financing commitments to fund the consideration payable for the shares and any incremental funds needed to successfully execute the Offer. The Offer is not subject to a due diligence condition.
Two of Cossette's largest institutional shareholders, Burgundy Asset Management Ltd. and Beutel, Goodman & Company, who together hold or exercise control over 3,113,791 subordinate voting shares or approximately 18.6% of Cossette's outstanding shares on a fully diluted basis, have agreed to tender their shares into the Offer as part of 'lock-up agreements' with Cosmos. These agreements include provisions giving Cosmos the ability to match any higher bid, which may be made for the Company. These provisions also allow the shareholders to accept a superior offer if it is not matched by Cosmos.
Cosmos, it affiliates, associates and joint actors, own or control, as of the date hereof, 3,120,313 Shares representing approximately 18.7% of Cossette's outstanding shares, which when taken together with the shares subject to the lock-up agreements, represent 37.3% of all issued and outstanding subordinate voting shares of Cossette.
In making the announcement, François Duffar, Chairman and CEO of Cosmos, stated that "The Cosmos offer is a compelling one and represents a full and fair price for Cossette shares, given the Company's financial performance and current business risks. For shareholders, it has the benefit of providing them with the certainty of an immediate cash payment for their shares". Duffar further added: "The fact that two of Cossette's largest institutional shareholders have agreed to tender their shares in support of the Cosmos offer validates this view."
Cosmos also announced that it is deeply concerned about actions the Board of Directors and Chief Executive Officer of Cossette have taken in the preceding months. Cosmos stated that it believes that the actions of the Board of Directors have had the effect of preventing shareholders from having the opportunity to respond to the Cosmos proposal. For example, on
The option grant is difficult to justify in light of the recent performance of the Company. During its last fiscal quarter, the Company generated losses of
For these reasons, Cosmos has chosen to present its offer directly to the Company's shareholders so they may fully and independently consider the merits of it.
Further details about the Cosmos Offer will be provided in the Offer Circular, which will be publicly filed as soon as practicable, and mailed to Cossette shareholders following receipt by Cosmos of a complete and up-to-date shareholder list from Cossette. Cosmos intends to formally commence the Offer on or before
The Offer will be subject to customary conditions, including but not solely: there being tendered to the Offer a number of shares that, together with the shares then beneficially owned by the Offeror, its affiliates and associates and persons acting jointly or in concert with the Offeror, represents 66 2/3% of the total number of outstanding subordinate voting shares of Cossette Inc. on a fully diluted basis; the waiver, redemption or granting of a cease trade order in respect of the shareholder rights plan put in place by Cossette on
Genuity Capital Markets is acting as the exclusive financial advisor to Cosmos Capital. McCarthy Tétrault S.E.N.C.R.L., s.r.l. and Torys LLP are acting as legal advisors to Cosmos.
About Cosmos Capital Inc.
Cosmos Capital is a company incorporated in Québec. Its investors include two of Cossette's founding partners - François Duffar, former Vice-Chair and President of Cossette and Georges Morin, former Senior Vice President of Cossette -
Additional Information
The offer is being made for the securities of a Canadian issuer. The offer is subject to disclosure requirements of
This announcement is for informational purposes only and does not constitute an offer to purchase or a solicitation of an offer to sell Subordinate Voting Shares of Cossette. The offer is being made pursuant to an Offer to Purchase and Circular and other related offer materials to be filed by Cosmos with the Canadian Securities Administrators on or about
The enforcement by Shareholders of civil liabilities under
No assurance can be given that the proposed transaction described herein will be consummated by Cosmos or that it will be completed on the terms proposed or within any particular schedule. Any information regarding Cossette contained herein has been taken from, or is based upon, publicly available information. Although Cosmos does not have any information that would indicate that any information contained herein is inaccurate or incomplete, Cosmos does not undertake any responsibility for the accuracy or completeness of such information. Cosmos does not undertake, and specifically disclaims, any obligation or responsibility to update or amend any of the information above except as otherwise required by law.
Forward-Looking Statements
Certain statements made in this press release are forward-looking statements that involve risks and uncertainties. Often, but not always, forward-looking statements can be identified by the use of words such as "plans," "expects," "expected," "scheduled," "estimates," "intends," "anticipates," or "believes," or variations of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. These forward-looking statements reflect Cosmos' best judgment based on current information, factors and assumptions, and although it bases these statements on circumstances that it believes to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance or actions, and actual performance and actions may vary materially from the actions and expectations discussed in this documentation. Cosmos disclaims any intention or obligation to update or revise any forward looking information whether as a result of new information, future events or otherwise, except as required by applicable law.
For further information: For further information: Shareholders and investors: Jean-François Desjardins, Genuity Capital Markets, (514) 281-3245; Media: Sylvia Morin, Cosmos Group, (514) 240-3841
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