Revolution vote “in favour” of Stonegate’s cash offer

10/10/2017 - 09:02
Following The Deltic Group’s announcement of a merger proposal, Revolution Bars Group has warned shareholders of “significant areas of uncertainty” - advising them to “vote in favour of Stonegate’s [203p cash] offer at the Revolution shareholder meetings on 17 October.”

Non-executive chairman, Keith Edelman, said: “The Board does not believe that the pursuit of a merger with Deltic is in the best interests of the company or its shareholders and, in the absence of a firm cash offer from Deltic, maintains its unanimous recommendation that shareholders should vote in favour of Stonegate’s offer at the Revolution shareholder meetings on 17 October 2017.”

Among the board’s main concerns over both the “proposed value and deliverability” of Deltic’s proposal, it states:

  • The merger proposal would not create shareholder value for Revolution’s existing shareholders 

  • There is no guarantee that the Deltic management team would be able to deliver its forecast financial performance or the estimated cost synergies, and Revolution’s business operations and financial performance may suffer if the cost synergies are implemented
  • The merger proposal would result in much greater indebtedness of the Enlarged Group compared to Revolution’s current indebtedness
  • The proposal is not binding and may take several months to complete, and would not be completed until the first half of 2018 in any event
  • Fundamental misalignment of the two business models -

Claiming that it has “made a considerable effort to ensure that Deltic has been provided with due diligence materials and to Revolution’s management team,” the board continues to recommend the cash offer from Stonegate, which is expected to become effective on 23 October if shareholders approve it on 17 October.

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