BURNABY, BC, Dec. 17, 2014 /CNW/ - GLENTEL Inc. ("GLENTEL") (TSX: GLN) today received notice of an Ontario Superior Court of Justice application by Rogers Communications Partnership to obtain an injunction to block GLENTEL's acquisition by BCE Inc. (TSX, NYSE: BCE; Bell) based on a Rogers Wireless retail agreement with GLENTEL.
"For over 25 years, GLENTEL has distributed Rogers mobile products through our Canadian retail stores and we hope to continue to do so. The BCE acquisition does not affect GLENTEL's agreement with Rogers which will continue to remain in force after the acquisition completes. Rogers has the right to remove their products from our Canadian stores if they choose or to terminate its agreement with us, but has no right under its agreement to block the acquisition of GLENTEL, which operates in Canada, the United States, Australia and the Philippines," said Tom Skidmore, GLENTEL President and CEO. "Rogers' claim is without merit and we will certainly defend against it. Approval of the acquisition is up to GLENTEL's shareholders, not one of our many suppliers, and we look forward to closing the acquisition in early 2015."
The Board of Directors of GLENTEL, acting on the unanimous recommendation of the Special Committee (which consisted solely of independent directors of GLENTEL), had unanimously approved the transaction and recommended that GLENTEL shareholders vote in favour of it. The Skidmore family, which owns approximately 37% of the common equity of GLENTEL, supports the transaction.
As announced on November 28, 2014, Bell will acquire all of GLENTEL's approximately 22.4 million fully diluted common shares for a total consideration for GLENTEL's equity of approximately $594 million. This represents a premium of 108% based on GLENTEL's closing share price on the TSX on November 27, 2014 and a 121% premium to the volume weighted trading average share price on the TSX for the 10 trading days prior to November 28. The agreement between Bell and GLENTEL provides for a non-solicitation covenant on the part of GLENTEL and gives Bell the right to match any superior proposal.
The proxy circular is being mailed to GLENTEL shareholders as scheduled this week and a special meeting of GLENTEL shareholders is scheduled for January 12, 2015.
Details of Rogers' application
On December 17, 2014, Rogers Communications Partnership filed an application in the Ontario Superior Court of Justice (Commercial List) against GLENTEL seeking, among other relief, to prohibit the transactions contemplated by the BCE acquisition plan of arrangement.
Rogers' position is that its agreement with GLENTEL requires Rogers' approval prior to a change of control of GLENTEL. GLENTEL's position is that Rogers' application is meritless, and that GLENTEL is able to complete the transaction according to its terms.
Based in Burnaby, BC, Canada, GLENTEL (TSX: GLN) is a provider of innovative and reliable wireless communications services and solutions, offering a choice of network carrier and wireless or mobile products and services to consumers and commercial customers. GLENTEL is an independent multicarrier mobile phone retailer in Canada and Australia. In the United States, GLENTEL operates two of the six National Premium Retailers for Verizon Wireless. To its business and government customers, GLENTEL offers wireless systems and hardware, rental equipment, and system implementation services. GLENTEL celebrated its 50th anniversary in 2013.
GLENTEL employs over 4,670 employees and operates approximately 1,400 locations, including 494 retail and business locations in Canada, 735 locations in the United States; and 147 retail locations in Australia and the Philippines.
Caution concerning forward-looking statements
Certain statements made in this news release are forward-looking statements, including, but not limited to, statements relating to the proposed acquisition by BCE Inc. (BCE) of all of the issued and outstanding common shares of GLENTEL Inc., the expected timing and sources of funding of the proposed transaction, our business outlook, objectives, plans and strategic priorities, and other statements that are not historical facts. Forward-looking statements are typically identified by the words assumption, goal, guidance, objective, outlook, project, strategy, target and other similar expressions or future or conditional verbs such as aim, anticipate, believe, could, expect, intend, may, plan, seek, should, strive and will. All such forward-looking statements are made pursuant to the "safe harbour" provisions of applicable Canadian securities laws and of the United States Private Securities Litigation Reform Act of 1995.
Forward-looking statements, by their very nature, are subject to inherent risks and uncertainties and are based on several assumptions, both general and specific, which give rise to the possibility that actual results or events could differ materially from our expectations expressed in or implied by such forward-looking statements. As a result, we cannot guarantee that any forward-looking statement will materialize and we caution you against relying on any of these forward-looking statements. The forward-looking statements contained in this news release describe our expectations at the date of this news release and, accordingly, are subject to change after such date. Except as may be required by Canadian securities laws, we do not undertake any obligation to update or revise any forward-looking statements contained in this news release, whether as a result of new information, future events or otherwise. Forward-looking statements are provided herein for the purpose of giving information about the proposed transaction referred to above and its expected impact. Readers are cautioned that such information may not be appropriate for other purposes.
The completion and timing of the proposed transaction are subject to customary closing conditions, termination rights and other risks and uncertainties including, without limitation, court, shareholder and regulatory approvals, including competition and stock exchange approvals. Accordingly, there can be no assurance that the proposed transaction will occur, or that it will occur on the terms and conditions, or at the time, contemplated in this news release. The proposed transaction could be modified, restructured or terminated.
NO STOCK EXCHANGE, SECURITIES COMMISSION, OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.
SOURCE: Glentel Inc.
For further information: GLENTEL Inc., Jas Boparai, Chief Financial Officer, (604) 415-6500, [email protected]