Optimal Group Enters Into Support Agreement With Management of WowWee Group for Offer of US$2.40 per Share
17 Março 2010 - 8:30AM
Marketwired
Optimal Group Inc. (NASDAQ: OPMR) today announced that it has
entered into a support agreement with a corporation established by
Richard Yanofsky, President of WowWee Canada Inc., and Peter
Yanofsky, President of WowWee USA, Inc., for the purpose of making
an offer to acquire, by way of a take-over bid to Optimal Group
shareholders, all of the outstanding Class "A" shares of the
Company, including shares issuable upon the conversion, exchange or
exercise of options and warrants, at a price of US$2.40 per share
in cash. WowWee Canada Inc. and WowWee USA, Inc. are wholly-owned
subsidiaries of Optimal Group. The offer represents a premium of
approximately 50% over the closing price of the Class "A" shares of
US$1.60 on the NASDAQ, on March 16, 2010. Under the terms of the
support agreement, Optimal Group may solicit, respond to and
consider competing third-party proposals until closing of the
offer.
As a result of Richard and Peter Yanofsky's involvement with the
offeror, the offer will be an "insider bid" and a going private
transaction for purposes of applicable securities laws.
Accordingly, the Board of Directors of the Company established a
special committee of independent directors to review the terms of
the offer and to supervise the preparation of a formal valuation of
the Class "A" shares.
The special committee retained PricewaterhouseCoopers LLP as
independent valuator to prepare a formal valuation of the Class "A"
shares. Based on the information considered and valuation
approaches utilized, PricewaterhouseCoopers LLP concluded that the
fair market value of the shares was in the range of US$2.01 to
US$2.55 per share. The special committee also retained Genuity
Capital Markets to act as financial advisor to Optimal Group and
the special committee and Ogilvy Renault LLP as legal advisor to
the special committee to advise it in connection with the offer.
Genuity Capital Markets provided an opinion to the Board of
Directors of the Company and to the special committee that, based
upon and subject to the analyses, assumptions, qualifications and
limitations set out in such opinion, the consideration offered
pursuant to the offer is fair, from a financial point of view, to
all shareholders of the Company (other than the insiders and
related entities making the offer).
The Board of Directors of the Company, after consultation with
its legal and financial advisors, and following the receipt and
review of recommendations from its special committee, the opinion
of its financial advisor as to the fairness of the offer, from a
financial point of view, to shareholders of the Company (other than
the insiders and related entities making the offer) and the
independent formal valuation prepared by PricewaterhouseCoopers,
determined that the offer is in the best interests of the Company
and is fair, from a financial point of view, to the shareholders of
the Company (other than the insiders and related entities making
the offer), approved the execution of the support agreement and
resolved to recommend that the shareholders of the Company (other
than the insiders and related entities making the offer) accept the
offer.
The offer will be subject to customary conditions including the
valid deposit under the offer of at least 66 2/3% of the
outstanding Class "A" shares and the absence of a material adverse
effect to the Company and its subsidiaries.
Under the terms of the support agreement, the Company has agreed
to pay a termination fee of approximately US$500,000 to the offeror
if the support agreement is terminated in certain
circumstances.
Under the terms of the support agreement, the Company has
retained the ability to solicit, respond to and consider competing
acquisition proposals which the Board of Directors of the Company
believes, in the exercise of its fiduciary duties, represent, or
could reasonably be expected to lead to, a superior proposal, and
to terminate the support agreement in the event the Company
proposes to enter into any agreement with respect to a superior
proposal, subject to the offeror's right to match or be paid the
termination fee.
The take-over bid circular containing the full terms of the
offer is expected to be mailed to shareholders on or before March
31, 2010. The full text of the valuation prepared by
PricewaterhouseCoopers and the fairness opinion prepared by Genuity
Capital Markets, which the shareholders are urged to read in their
entirety, will be set forth in the directors' circular. The offer
will remain open for acceptance for a period of not less than 35
days following the mailing of the offer.
In connection with the offer, Neil S. Wechsler, Co-Chairman and
Chief Executive Officer, Holden L. Ostrin, Co-Chairman, and Gary S.
Wechsler, Chief Financial Officer, of the Company have entered into
an agreement with the offeror pursuant to which they or a
corporation controlled by them will acquire all of the outstanding
shares of Optimal Merchant Services Inc. (formerly Optimal Payments
Corp.), a wholly-owned subsidiary of Optimal Group, in partial
satisfaction of the severance payments that will become owing to
them on closing of the transactions contemplated in the support
agreement. These executives have agreed to enter into such
agreement with any other person making an offer for the Class "A"
shares of the Company.
The offer described in this press release has not yet commenced,
and this press release does not constitute an offer to purchase or
a solicitation of an offer to sell any securities. At the time the
expected tender offer is commenced, the offeror will file a tender
offer statement with the U.S. Securities and Exchange Commission
and mail and file offer materials as required by Canadian and U.S.
laws, and the Company will also file required
solicitation/recommendation materials. The tender offer materials
will contain important information and shareholders of the Company
should read this information carefully before making any decision
about the tender offer.
The tender offer materials, certain other offer materials and
the solicitation/recommendation materials will be sent to all
shareholders of the Company free of charge and will also be
available free of charge on the SEC's website at www.sec.gov and on
SEDAR at www.sedar.com.
For information about Optimal Group, please visit the Company's
website at www.optimalgrp.com.
Contacts: Optimal Group Inc. Leon P. Garfinkle Senior Vice
President and General Counsel 514-738-8885 leon@optimalgrp.com
www.optimalgrp.com
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