OWEGO, N.Y., Feb. 23, 2015 /PRNewswire/ -- Adam Weitsman
of Upstate Shredding, LLC ("Upstate Shredding"), the East Coast's
largest privately owned scrap metal processor and recycling center,
announced today that he has submitted a written proposal to the
Chairman, President and Chief Executive Officer of Metalico, Inc.
(NYSE MKT: MEA) ("MEA") to acquire all of the outstanding shares of
MEA for $0.78 per share in cash. Mr.
Weitsman's proposal represents an approximately 32% premium to the
average market price of MEA's shares over the past 30 days and an
approximately 27% premium to the closing price of MEA's shares on
February 20, 2015. Mr. Weitsman
currently owns approximately 11.7% of the outstanding common stock
of MEA.
"I am deeply disappointed by the apparent unwillingness of MEA's
Board and management to meet with me to date, despite my
significant holdings in MEA," said Mr. Weitsman. "As a
result, I have decided to publicly announce my proposal to acquire
MEA, which I believe represents a compelling opportunity for MEA's
stockholders to obtain liquidity for their shares while maximizing
the value of their shares at a premium. I strongly believe
that MEA has great potential but do not believe it is in the best
interest of stockholders for MEA to continue as an independent
company, let alone a public company, given MEA's long-term
underperformance and poor stock price performance," continued Mr.
Weitsman.
Weitsman's proposal is conditioned upon the satisfactory
completion of confirmatory due diligence, obtaining all material
and necessary consents and approvals, including by MEA's
convertible noteholders and bank lenders, waiver of any Company
anti-takeover provisions, including redemption of the Company's
poison pill, other customary conditions for a transaction of this
type and size and the execution of a definitive agreement.
Weitsman is prepared to open up discussions with MEA's
convertible noteholders and bank lenders and is highly confident of
receiving their consent for this transaction based on Upstate
Shredding's financial strength and reputation in the
industry. Upstate Shredding will pursue replacement financing
if necessary.
With 36 straight quarters of profitability, Upstate Shredding
has considerable financial strength and full knowledge and
expertise in the geographical region in which MEA operates.
Upstate Shredding is the recipient of a number of awards,
including, in 2014, the Platts, a division of McGraw Hill, global
award for Scrap Company of the Year. Upstate Shredding was
also a finalist for AMM (American Metal Market) Scrap Company of
the Year in 2014. Weitsman's affiliates have been in the
scrap metal recycling business since 1938 and therefore limited
confirmatory due diligence will be required.
The full text of the proposal letter follows:
February 23,
2015
Via Facsimile and Overnight Mail
Carlos E. Aguero
Chairman, President and Chief Executive Officer
Metalico, Inc.
186 North Avenue
East Cranford, NJ 07016
Dear Mr. Aguero:
As you know, I am a significant stockholder of Metalico, Inc.
("Metalico" or the "Company"), currently owning approximately 11.7%
of the outstanding shares of Metalico. I am also the owner of
Upstate Shredding, LLC ("Upstate Shredding"), the East Coast's
largest privately owned scrap metal processor and recycling center,
and one of the largest operations of its type in the eastern
United States. I am deeply
disappointed by the apparent unwillingness of Metalico's Board and
management to meet with me to date to discuss my concerns regarding
Metalico's poor financial and stock price performance.
I strongly believe that Metalico has great potential but do not
believe it is in the best interest of stockholders for Metalico to
continue as an independent company, let alone a public
company. Executing a turnaround is difficult. Executing
a turnaround in the public spotlight is even more
challenging. Accordingly, I set forth my willingness to
acquire all of the outstanding shares of common stock of Metalico,
other than shares owned directly by me, through an appropriate
acquisition entity, by merger or otherwise, for $0.78 per share in cash. My offer price
represents an approximately 32% premium to the average market price
of the Metalico shares over the past 30 days and an approximately
27% premium to the closing price of Metalico's shares on
February 20, 2015. I
believe that merging Metalico with and into Upstate Shredding (or
an affiliated entity) would create a stronger, more diversified
company and also represents a compelling opportunity for Metalico's
stockholders to obtain liquidity for their shares while maximizing
the value of their shares at a premium.
With 36 straight quarters of profitability, Upstate Shredding
has considerable financial strength and full knowledge and
expertise in the geographical region in which Metalico
operates. Upstate Shredding is the recipient of a number of
awards, including, in 2014, the Platts, a division of McGraw Hill,
global award for Scrap Company of the Year. Upstate Shredding
was also a finalist for AMM (American Metal Market) Scrap Company
of the Year in 2014. My affiliates have been in the scrap
metal recycling business since 1938 and therefore I believe I can
complete my confirmatory due diligence on an expeditious
basis.
Based on my review of Metalico's public filings, I understand
that consent would be required from your convertible noteholders
and bank lenders. I am prepared to open up discussions with
Metalico's noteholders and bank lenders and am highly confident of
receiving their consent for this transaction based on Upstate
Shredding's financial strength and reputation in the
industry. Upstate Shredding will pursue replacement financing
if necessary.
My proposal is conditioned upon satisfactory completion of
confirmatory due diligence, obtaining all material and necessary
consents and approvals, including by Metalico's convertible
noteholders and bank lenders, waiver of any Company anti-takeover
provisions, including redemption of the Company's poison pill,
other customary conditions for a transaction of this type and size
and the execution of a definitive agreement. I am committed
to my $0.78 all-cash offer and am
prepared to immediately commence my confirmatory due diligence and
enter into negotiations for a definitive acquisition
agreement.
The stockholders deserve to receive a full and fair price for
their shares now. Given the Board's apparent unwillingness to
meet with me to date, I have no choice but to disclose this offer
publicly. While I believe it would be in everyone's best
interest to complete this transaction on a friendly basis, in the
event that the Board is unwilling to negotiate a transaction that
maximizes value for all stockholders, and instead chooses to
continue with its current plan, I reserve all rights to take any
action I deem necessary to ensure the best interests of all
stockholders are represented, including modifying or revoking this
offer and taking my concerns directly to stockholders.
I stand ready to meet with the independent members of the Board
of Directors and their representatives as soon as possible.
Please call me as soon as possible to discuss.
/s/ Adam
Weitsman
Adam
Weitsman
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SOURCE Adam Weitsman