Rock of Ages Announces $5.25 Per Share Cash Merger Agreement with Swenson Granite
October 18 2010 - 9:00AM
Business Wire
Rock of Ages Corporation (NASDAQ:ROAC) today announced
that it has entered into a definitive merger agreement with Swenson
Granite Company LLC (“Swenson Granite”) whereby shareholders of
Rock of Ages will receive $5.25 per share in cash, and Swenson
Granite will acquire 100% ownership of Rock of Ages.
The Rock of Ages Board of Directors, based in part on the
unanimous recommendation of a special committee of three Rock of
Ages independent directors, unanimously adopted, and recommends
that shareholders of the Company vote for approval of, the merger
agreement. The special committee’s independent financial advisor
has delivered an opinion to the effect that the $5.25 per share to
be received by Rock of Ages shareholders in the merger is fair,
from a financial point of view, to such shareholders. The $5.25 per
share price represents a 57% premium to the average closing price
of Rock of Ages Class A common stock for the 30 days prior to the
May 7, 2010 announcement of Swenson Granite’s initial proposal to
acquire 100% ownership of Rock of Ages, and a 84% premium to the
average closing price for the 12 months prior to the May 7, 2010
announcement.
Consummation of the merger is conditioned upon, in addition to
approval of the merger agreement by the majority vote of Rock of
Ages' Class A and Class B common stock, voting together, approval
by a majority of the outstanding shares of Class A common stock,
excluding shares held by members of Swenson Granite. Rock of Ages
will schedule a special meeting of its shareholders for the purpose
of obtaining shareholder approval of the merger agreement.
Kurt Swenson, the Chairman of Swenson Granite and non-executive
Chairman of Rock of Ages, together with his brother, Kevin Swenson,
Vice President of Swenson Granite, and Robert Pope, President and
Chief Executive Officer of Swenson Granite, own approximately 71%
of Swenson Granite. They, along with certain other members of
Swenson Granite who are also Rock of Ages shareholders, have agreed
with Swenson Granite to vote their shares, representing
approximately 81% of the total voting power of all Rock of Ages
shares, in favor of approval of the merger agreement.
The merger agreement includes various other customary
conditions, but does not contain a financing condition. People’s
United Bank and Key Bank, National Association have committed,
subject to customary conditions, to provide debt financing for the
transaction.
Prior to the merger, Kurt Swenson, Kevin Swenson, Robert Pope
and certain other members of Swenson Granite who are also
shareholders of Rock of Ages, will contribute to Swenson Granite a
total of 258,326 Class A shares and 2,449,793 Class B shares of
Rock of Ages in exchange for additional shares of membership
interest in Swenson Granite, and will not receive the $5.25 per
share cash merger price for those Rock of Ages shares.
Covington Associates, LLC served as financial advisor to the
special committee of the Rock of Ages board of directors and
Skadden, Arps, Slate, Meagher & Flom LLP served as legal
advisor to the special committee. Sheehan Phinney Bass + Green PA
served as legal counsel to Swenson Granite.
About Rock of Ages
Rock of Ages (www.RockofAges.com) is the largest integrated
granite quarrier and manufacturer of finished granite memorials and
granite blocks for memorial use in North America.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements are based on current expectations about
future events. These statements are not guarantees of future events
and involve risks, uncertainties and assumptions that are difficult
to predict. Therefore, actual events may differ materially from
what is expressed in such forward-looking statements due to
numerous factors. A statement containing an expectation or
prediction as to the consummation of the merger is just an example
of a forward-looking statement. Some factors that could
realistically cause events to differ materially from those
predicted in the forward-looking statements include the occurrence
of any event, change or other circumstances that could give rise to
the termination of the merger agreement with Swenson Granite
Company LLC (“Swenson Granite”); the outcome of any legal
proceedings that have been, or may be, instituted against Rock of
Ages related to the merger agreement; the inability to complete the
merger due to the failure to obtain shareholder approval for the
merger or the failure to satisfy other conditions to completion of
the merger; and the failure of Swenson Granite to obtain the
necessary financing arrangements relating to the merger. Further
information and risks regarding factors that could affect our
business, operations, financial results or financial positions are
discussed from time to time in Rock of Ages’ Securities and
Exchange Commission filings and reports. Such forward-looking
statements speak only as of the date on which they are made, and
Rock of Ages does not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after
the date of this release, except as may be required under the
federal securities laws.
About the Proposed Transaction
In connection with the proposed merger, Rock of Ages will file a
proxy statement with the Securities and Exchange Commission.
INVESTORS AND SECURITY HOLDERS ARE STRONGLY ADVISED TO READ THE
PROXY STATEMENT WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION. Investors and security holders may obtain a
free copy of the proxy statement (when available) and other
documents filed by Rock of Ages from the Securities and Exchange
Commission’s Web site at http://www.sec.gov. The proxy statement
and such other documents may also be obtained for free from Rock of
Ages’ website at http://www.rockofages.com or by directing such
request to Rock of Ages Corporation, Chief Financial Officer, 560
Graniteville Road, Graniteville, Vermont 05654, telephone: (802)
476-3115.
Rock of Ages and its directors, executive officers and certain
other members of its management and employees may be deemed to be
participants in the solicitation of proxies from its shareholders
in connection with the proposed merger. Information regarding the
interests of Rock of Ages’ participants in the solicitation will be
included in the proxy statement relating to the proposed merger
when it becomes available. Additional information regarding Rock of
Ages’ directors and executive officers is also included in Rock of
Ages’ proxy statement for its 2010 Annual Meeting of Stockholders,
which was filed with the SEC on July 19, 2010. This document is
available free of charge from the SEC’s Web site at www.sec.gov,
from Rock of Ages’ website at http://www.rockofages.com or by
directing such request to Rock of Ages Corporation, Chief Financial
Officer, 560 Graniteville Road, Graniteville, Vermont 05654,
telephone: (802) 476-3115.
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