Loring Ward International Ltd. (TSX: LW) announced that it has entered into a definitive agreement with Werba Reinhard, Inc., a company controlled by Loring Ward's largest shareholder, Eli Reinhard, and Alan Werba, one of Loring Ward's largest investment advisor clients, under which an affiliate of WRI will acquire all of Loring Ward's outstanding shares pursuant to a plan of arrangement at a price of US$18.00 per share in cash payable in U.S. dollars.
The price is currently equivalent to approximately Cdn$18.47, which represents a premium of approximately 57.9% to the price on February 13, 2008, the day prior to the initial announcement of an unsolicited offer for the Company. The price agreed to with WRI exceeds the US$17.35 per share offer previously agreed to with Friedman Fleischer & Lowe LLC, which has declined to match WRI's proposed price.
The Company has received an opinion from its financial advisor, BMO Capital Markets, that the offer is fair from a financial point of view to shareholders of Loring Ward. The Special Committee and Board have concluded unanimously that shareholders should vote in favour of the Plan of Arrangement with WRI and have determined that the transaction is fair and in the best interests of shareholders.
David Rattee, the Chairman of the Board and of the Special Committee of independent directors who evaluated the offer and led the auction process, said "We are unanimously recommending that shareholders approve this transaction. We are very pleased with the outcome for our shareholders".
The Plan of Arrangement is subject to certain conditions, including, among others, minimum asset levels at the time of closing and required court and shareholder approvals, as set forth in the Agreement. As a result, there can be no assurance that it will be completed. The Agreement is not subject to a financing condition, and WRI has advised that it has made appropriate arrangements with its lenders to seek to obtain all required financing. Pursuant to the agreement previously entered into with FFL, the Company has paid FFL a transaction break fee and reimbursed FFL for its reasonable transaction-related expenses.
The special meeting of shareholders previously scheduled for August 6, 2008 has been cancelled and the management proxy circular and related materials recently received by shareholders for consideration of the acquisition of Loring Ward by FFL should be disregarded. A new special meeting date is expected to be called in the near future, and a new management proxy circular is expected to be mailed to shareholders in connection therewith. Loring Ward also is seeking court approval to delay its annual general meeting until no later than November 14, 2008. -- www.cnxmarketlink.com
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