Netshoes Announces Amendment to the Merger Agreement with Magazine Luiza

Date : 06/13/2019 @ 11:14AM
Source : Business Wire
Stock : Netshoes (Cayman) Limited (NETS)
Quote : 3.7  0.0 (0.00%) @ 12:00AM
Netshoes (Cayman) Limited share price Chart

Netshoes Announces Amendment to the Merger Agreement with Magazine Luiza

Netshoes (Cayman) Limited (NYSE:NETS)
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6 Months : From May 2019 to Nov 2019

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Netshoes (Cayman) Limited (NYSE: NETS) announces that it has entered into a second amendment to the Agreement and Plan of Merger, dated April 29, 2019, and amended on May 26, 2019, by and among Netshoes, Magazine Luiza S.A. (“Magalu”) and its subsidiary (as amended from time to time, the “Merger Agreement”) to increase the Per Share Merger Consideration (as such term is defined in the Merger Agreement) from US$3.00 to US$3.70, and to increase the amount of that certain Company Termination Payment (as such term is defined in the Merger Agreement) from US$1,800,000 to US$6,000,000 (the “Amendment”).

The Amendment was executed after careful review and consideration, by the Board of Directors of Netshoes (the “Netshoes Board”), of (i) a revised unsolicited proposal received on June 11, 2019, from Grupo SBF S.A., a sociedade anônima incorporated under the laws of Brazil and with shares listed in the Brazilian stock exchange (B3) under ticker “CNTO3” (“Centauro”), for purchase of all of the outstanding common shares of Netshoes through a merger transaction pursuant to which Netshoes shareholders would receive a payment in cash of US$3.70 for each share, and (ii) Magalu’s proposed amendments to the Merger Agreement, as set forth in the Amendment.

The Netshoes Board has unanimously approved (with the abstention of Mr. Marcio Kumruian on advice of counsel) the Amendment to the Merger Agreement and unanimously reaffirms its recommendation (with the abstention of Mr. Kumruian on advice of counsel) that Netshoes’ shareholders vote in favor of the transactions contemplated by the Merger Agreement. In reaching this determination, the Netshoes Board took into account:

(1) the increase in the Per Share Merger Consideration;

(2) the high degree of certainty of the completion of the Merger with Magazine Luiza on or prior to June 19, 2019 (subject to approval by the shareholders of the Company);

(3) the final approval of the Magazine Luiza acquisition previously granted by the Brazilian antitrust authority;

(4) that any potential transaction between the Company and Centauro would involve calling a new shareholders meeting and review by Brazilian antitrust authorities, leading to delay and uncertainty; and

(5) that it is in Netshoes’ shareholders’ best interest to secure a transaction with a closing just a few days away given the previously disclosed pressures on Netshoes operating cash flow and financial condition.

In light of the aforementioned, the board of directors determined that it continues to be in the best interest of the shareholders of Netshoes to vote in favor of the resolutions authorizing the Merger Agreement and for Netshoes to consummate the transaction with Magazine Luiza.

IR ContactOtavio Lyra, Investor Relations OfficerSão Paulo, BrazilPhone: +55 11 3028-3528Email: ir@netshoes.comhttp://investor.netshoes.com

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