QUÉBEC CITY, Nov. 30 /CNW Telbec/ - Cossette Inc. ("Cossette") today announced that it has amended the previously announced merger agreement with Mill Road Capital, L.P. ("Mill Road") to provide for an increase in the all-cash consideration under the proposed privatization transaction of Cossette from $7.87 per share to $8.10 per share.
Under the terms of the amended merger agreement:
- Mill Road to acquire all of the issued and outstanding shares of
Cossette for a consideration of $8.10 per share in cash, other than a
portion of the shares of certain senior executive shareholders.
- Termination fee of $4.5 million.
- Definition of Superior Proposal provided in the amended merger
agreement now requires a 66 2/3% minimum tender condition.
- Expense reimbursement payable in certain circumstances where a
termination fee is not payable increased from $880,000 to $1.50 million
if triggered on or prior to December 31, 2009 and to $3.125 million if
triggered after December 31, 2009.
The other terms of the merger agreement remain unchanged. The amended transaction is not conditional on due diligence or financing.
The increased all-cash consideration of $8.10 per share represents a premium of approximately 150% over the unaffected share price of $3.25 on July 17, 2009, the last trading day prior to Cosmos Capital Inc. announcing its unsolicited and non-binding proposal to acquire all outstanding shares of Cossette at a price of $4.95 per share on July 20, 2009.
"We are pleased with the increased consideration under the Mill Road transaction. The Board of Directors and its Special Committee remain committed to maximizing value for shareholders while acting in the best interests of Cossette", said Jean Lavigueur, Chairman of the Special Committee of the Board of Directors of Cossette.
The amendment to the merger agreement with Mill Road was approved unanimously by the Board of Directors of Cossette (with interested directors, Claude Lessard and Pierre Delagrave, abstaining) following the report and favourable unanimous recommendation of the Special Committee comprised of four independent directors, namely Jean Lavigueur (Chairman), Robert Beauregard, Raymond Boucher and Paule Gauthier. In doing so, the Board determined that the Mill Road transaction, as amended, is fair to the shareholders of Cossette (excluding the senior executive shareholders who entered into support and voting agreements with Mill Road) and is in the best interests of Cossette and such shareholders. The Board has also determined unanimously (with interested directors abstaining) to recommend that the shareholders of Cossette (excluding the senior executive shareholders referred to above) vote in favour of the Mill Road transaction, as amended.
As previously announced, the special general meeting of shareholders of Cossette to consider the Mill Road transaction will be held at 10:00 a.m. (Eastern time) on Friday, December 18, 2009 at the Auditorium of Auberge Saint-Antoine, 8 Saint-Antoine Street in Québec City, Québec. To be effective, the Mill Road transaction must be approved by at least 66 2/3% of the votes cast by the shareholders of Cossette and by a simple majority of the votes cast by the shareholders other than the senior executive shareholders who entered into support and voting agreements with Mill Road and their respective related parties.
A copy of the amendment to the Mill Road merger agreement will be filed with Canadian securities regulators and will be available on SEDAR at www.sedar.com shortly. An amendment to the management information circular in connection with the special meeting of shareholders will be mailed to shareholders in due course.
Amended Cosmos Offer
The Board of Directors reaffirms its recommendation that shareholders reject the amended offer announced by Cosmos Capital Inc. on November 17, 2009 to purchase all of the outstanding shares of Cossette not already owned by Cosmos, its joint actors and its affiliates and associates at a price of $7.87 per share (the "Amended Cosmos Offer"), and not tender their shares to such Amended Cosmos Offer. Shareholders who have tendered shares to the Amended Cosmos Offer should withdraw them in accordance with the withdrawal process that is described in the Cosmos' circular.
Cossette Inc. offers a full range of leading-edge communication services to clients of all sizes, including some of the most prestigious brands in the world. A customer-driven organization built around highly specialized business units, Cossette also offers Convergent Communications(TM), a unique working method that brings added value to the client by integrating various services offered by the Group, including strategic planning and research, advertising, media buying and channel planning, sales promotion, direct response, database and direct marketing, customer relationship management, interactive marketing and technology solutions, public relations, organizational communication and change management, sponsorship and alliance marketing, branding and design, ethnic marketing, business-to-business communications (B2B practices) and print and video production. Cossette has approximately 1,437 employees and offices in Quebec City, Montreal, Toronto, Vancouver, Halifax, New York, Irvine, Los Angeles, London and Shanghai.
SOURCE COSSETTE INC.
For further information: For further information: Financial Analysts only: Martin Faucher, Vice-President and Chief Financial Officer, (418) 521-3784; Investors: Francis Trudeau, Director, Acquisitions and Investor Relations, (514) 282-4633; Medias: Sylvie Isabelle, Optimum Public Relations, (418) 521-3184; Source: Cossette Inc., www.cossette.com