Joint press release - Intier shareholders to vote on privatization proposal from Magna
February 09 2005 - 6:33PM
PR Newswire (US)
Joint press release - Intier shareholders to vote on privatization
proposal from Magna AURORA, ON, Feb. 9 /PRNewswire-FirstCall/ --
Magna International Inc. (TSX: MG.SV.A, MG.MV.B; NYSE: MGA) and
Intier Automotive Inc. (TSX: IAI.SV.A; NASDAQ: IAIA) today jointly
announced that they have entered into a definitive arrangement
agreement that would allow Intier shareholders to vote on whether
Magna would acquire all the outstanding Class A Subordinate Voting
Shares of Intier not owned by Magna by way of a court-approved plan
of arrangement under Ontario law. The proposal by Magna to
privatize Intier was previously announced on October 25, 2004.
Under the terms of the arrangement agreement, shareholders of
Intier will receive 0.41 of a Class A Subordinate Voting Share of
Magna for each Class A Subordinate Voting Share of Intier
(representing a 6.58% increase from Magna's initial proposal of
0.3847) or, at the election of any shareholder, cash based on the
volume-weighted average trading price of Magna's Class A
Subordinate Voting Shares over the five trading days ending on the
last trading day immediately preceding the effective date of the
plan of arrangement. The aggregate cash payable to all electing
Intier shareholders in the proposed transaction would be capped at
Cdn.$125 million. If shareholders elect to receive cash in excess
of Cdn.$125 million in the aggregate, the total cash available will
be prorated among those shareholders electing to receive cash and
the balance of their consideration will be satisfied in Magna Class
A Subordinate Voting Shares. The Intier Board of Directors formed a
Special Committee of independent directors comprised of Lawrence
Worrall and Neil G. Davis to consider the privatization proposal.
The Special Committee retained RBC Capital Markets as financial
advisor and independent valuator. Subject to the assumptions,
qualifications, limitations and conditions set forth in its
valuation and opinion, in the opinion of RBC, as at February 9,
2005, the fair market value of the Intier Class A Subordinate
Voting Shares is in the range of US$35 to US$40 and the
consideration under the proposed transaction is inadequate, from a
financial point of view, to Intier minority shareholders. Based on
the closing price of the Magna Class A Subordinate Voting Shares on
the NYSE on February 8, 2005, the value of the consideration
offered under the privatization proposal is US$31.06 per Intier
Class A Subordinate Voting Share. The closing price of the Intier
Class A Subordinate Voting Shares on NASDAQ on October 22, 2004
(the last trading day prior to the announcement of the
privatization proposal) was US$20.70. Based on the recommendation
of the Special Committee, the Board of Directors of Intier has
authorized the submission of the resolution in respect of the
privatization to a vote of the Intier shareholders without any
recommendation from the Board as to how shareholders should vote in
respect of the resolution. In addition to the opinion of RBC
Capital Markets, the Special Committee and the Board of Directors
have identified a number of other important factors, such as the
lack of liquidity of Intier's Class A Subordinate Voting Shares and
the unlikelihood of any other third party offer, which shareholders
should consider in determining how to vote in respect of the
privatization proposal. The management information circular/proxy
statement for the shareholders meeting will include a discussion of
all these considerations, together with a copy of the RBC valuation
and opinion. It is anticipated that the management information
circular/proxy statement will be mailed to shareholders on or about
March 7, 2005. The management information circular/proxy statement
will also be available on the Internet at http://www.sedar.com/ and
on Intier's website at http://www.intier.com/. Intier has set a
record date of February 24, 2005 for shareholders entitled to
receive notice of the special meeting. Subject to court approval,
Intier expects to hold the special meeting on March 30, 2005 in
Toronto and expects that the arrangement, if approved, will become
effective on April 3, 2005. The arrangement will require approval
of two-thirds of the votes cast by holders of Intier Class A
Subordinate Voting Shares, Intier Class B Shares and Intier
Convertible Preferred Shares. The arrangement also requires the
approval of a simple majority of the votes cast by the minority
holders of Intier Class A Subordinate Voting Shares. Magna, parties
related to Magna and certain interested parties may not vote their
Intier Class A Subordinate Voting Shares for the purposes of this
"majority of the minority" approval requirement. The arrangement
will also be subject to the approval of the Ontario Superior Court
of Justice. The Intier Board also declared today a dividend of
U.S.$0.17 per Intier Class A Subordinate Voting Share and Class B
Share, such amount representing a dividend of U.S.$0.10 per share
in respect of the fourth quarter of 2004 and a dividend of
U.S.$0.07 per share in respect of the first two months of 2005.
This U.S.$0.17 dividend will be payable on or after March 15, 2005
to shareholders of record as of February 28, 2005. Intier will
announce its financial results for the fourth quarter ended
December 31, 2004 following the close of business on Thursday,
February 24, 2005. Intier is a global full service supplier and
integrator of automotive interior and closure components, systems
and modules. It directly supplies most of the major automobile
manufacturers in the world with approximately 24,100 employees at
74 manufacturing facilities and 15 product development, engineering
and testing centres in North America, Europe, Brazil, Japan and
China. Magna, the most diversified automotive supplier in the
world, designs, develops and manufactures automotive systems,
assemblies, modules and components, and engineers and assembles
complete vehicles, primarily for sale to original equipment
manufacturers of cars and light trucks in North America, Europe,
Mexico, South America and Asia. Magna's products include:
automotive interior and closure components, systems and modules
through Intier Automotive Inc.; metal body systems, components,
assemblies and modules through Cosma International; exterior and
interior mirror and engineered glass systems through Magna
Donnelly; fascias, front and rear end modules, plastic body panels,
exterior trim components and systems, greenhouse and sealing
systems, roof modules and lighting components through Decoma
International Inc.; various engine, transmission and fueling
systems and components through Tesma International Inc.; a variety
of drivetrain components through Magna Drivetrain; and complete
vehicle engineering and assembly through Magna Steyr. Magna has
approximately 81,000 employees in 219 manufacturing operations and
49 product development and engineering centres in 22 countries.
This press release may contain "forward-looking statements" within
the meaning of applicable securities legislation. Such statements
involve certain risks, assumptions, uncertainties and other factors
which may cause actual future results or anticipated events to
differ materially from those expressed or implied in any
forward-looking statements. In the case of both Magna and Intier,
these factors principally relate to the risks associated with the
automotive industry and include the risks, assumptions,
uncertainties and other factors listed in Item 3 "Description of
Business - Risk Factors" in Magna's Annual Information Form
attached as Exhibit 1 to Magna's Annual Report on Form 40-F for the
year ended December 31, 2003, and Item 3 "Key Information - Risk
Factors" in Intier's Annual Report on Form 20-F for the year ended
December 31, 2003, each filed with the Ontario Securities
Commission and the United States Securities and Exchange
Commission. Unless otherwise required by applicable securities
laws, Magna and Intier do not intend, nor do Magna and Intier
undertake any obligation, to update or revise any forward-looking
statements to reflect subsequent information, events, results,
circumstances or otherwise. DATASOURCE: Intier Automotive Inc.
CONTACT: Vincent J. Galifi, Executive Vice-President and Chief
Financial Officer of Magna, (905) 726-7100; Michael McCarthy,
Executive Vice-President and Chief Financial Officer of Intier,
(905) 898-5200
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