Cedar Fair and Apollo Merger terminated
Posted
Cedar Fair Entertainment Company today announced that it and affiliates of Apollo Global Management, a leading global alternative asset manager, have mutually agreed to terminate the previously announced definitive merger agreement.
Consistent with the terms of the agreement, Cedar Fair will pay Apollo $6.5 million to reimburse Apollo for certain expenses incurred in connection with the transaction. In addition, both parties will release each other from all obligations with respect to the proposed merger transaction as well as from any claims arising out of or relating to the merger agreement.
Read the entire press release from Cedar Fair.
birdhombre said:
But is it saying that you will now need to own at least 20% of units in order to have a vote?
i haven't read the whole Rights Plan, but, it's a type of poison pill machination.
If some entity starts to control more than 20% of the units, then the "rights" (previously non-existent, and created solely for this purpose, think of them as like additional shares but that have no value), become separable from the shares, and have a value equal to two times the exercise price of the Right. Thus, it takes more effort than just buying or controlling 20% of the shares to take control of the company.
***** From the Rights Plan
If a person or group becomes an Acquiring Person, each holder of a Right will thereafter have the right to receive, upon exercise, Units (or, in certain
circumstances, cash, property or other securities of the Company) having a value equal to two times the exercise price of the Right. Notwithstanding any of the foregoing, following the existence of an Acquiring Person, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person will be null and void.
******************
you can still sell your 1, 2, 400, however many shares you have, and you still have the same amount of votes for anything via proxy. The wrinkle comes into play that the rights, (which are now worthless) suddenly have a value (and a cost to an acquirer) if someone (group) tries to take control.
...and if you read through the proxy statement, you'll find that much of the negotiation apparently centered on Cedar Fair getting Apollo to settle for a smaller breakup fee if the merger failed...and if they had gone for the vote, I think the fee would have been even larger.
--Dave Althoff, Jr.
/X\ _ *** Respect rides. They do not respect you. ***
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Well, it appears that neither of the large shareholders (Q-II or the other group) has any interest in assuming control of Cedar Fair, except to the extent of preventing the merger with Apollo. I do wonder if the plan had anything to do with preserving certain non-ownership rights of certain other major minority share holders... . . . . . .
--Dave Althoff, Jr.
/X\ _ *** Respect rides. They do not respect you. ***
/XXX\ /X\ /X\_ _ /X\__ _ _ _____
/XXXXX\ /XXX\ /XXXX\_ /X\ /XXXXX\ /X\ /X\ /XXXXX
_/XXXXXXX\__/XXXXX\/XXXXXXXX\_/XXX\_/XXXXXXX\__/XXX\_/XXX\_/\_/XXXXXX
Glad to see it didn't go through. Too bad they have to pay out 6.5 million.
as for the inverters Stopping the merger is in their best interest. most are investment companies. they can sit on teh shares they own and wait for the company to come back. the companies finances are actually very good and their isn't even a big debt do for 2 years.
It is going to be a raucous unit-holder meeting come June! I can hear the chants already, "Hey, Hey, Ho, Ho, the CEO has go to GO!!" The board of directors need to start doing their JOB and create some change in corporate management at Cedar Fair; Dick & Co. have become nothing more than a liability at this point, the same way Michael Eisner and his team became a liability at Disney.
I personally am looking forward to the day we can get rid of all the incessant Beach Boys music in the parks too, it is 2010 after all. There has to be other "summer beach themed" music that is more current, isn't there?!
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