Merck KGaA to Versum: Your own financial advisor supports our takeover bid
Staff Writer |
Merck, a leading science and technology company, issued an open letter to the shareholders of Versum Materials.
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On March 1, the Versum board of directors without any further explanation rejected Merck’s superior proposal to acquire all of the outstanding common stock of Versum for $48 per share in cash.
In its letter, Merck said: “We are fully committed to pursuing our Proposal.
"The Versum Board should consider the best interests of its shareholders and engage with us.”
"Dear Fellow Versum Shareholders:
"We are disappointed that the Versum Board of Directors has rejected without explanation our superior proposal to acquire all of the outstanding common stock of Versum for $48 in cash per share (our “Proposal”).
"Further, our offer to engage directly with Versum to understand the rationale for the Versum Board’s determination has not been accepted.
"We urge you to let the Versum Board know that Versum shareholders will not support the Entegris acquisition in light of our Proposal, which is unquestionably superior.
"Our Proposal reflects a 51.7% premium to Versum’s unaffected price and a 17.1% premium to the current market value of the Entegris stock that Versum shareholders would receive in the Entegris acquisition.
"Since the time our Proposal was announced, 35.6 million Versum shares have traded (32.6% of the total number of Versum basic shares outstanding) in just four trading days at a volume weighted average price of $48.58, an 18.5% premium to the current implied value of the Entegris stock consideration.
"Further, the premium valuation reflected in our Proposal is certain and immediate, without any of the significant ongoing integration, operational or market risks reflected in the value of the Entegris stock consideration and without the need for the achievement of synergies.
"The analysis of Versum’s own financial advisor Lazard supports our view that our Proposal is superior, both standalone and relative to the Entegris acquisition.
"Lazard also completed a “has-gets” analysis to compare the discounted cash flow value, including synergies, relative to Versum’s standalone value.
"That analysis ... demonstrates that Lazard’s valuation analysis is consistent with the market’s view that the value of the stock consideration offered by Entegris is far less than the value of our Proposal.
"While the transaction with Entegris is described as a “merger of equals”, there appears to be nothing equal about the treatment of Versum’s employees relative to those of Entegris.
"Entegris has already announced its intention to operate the combined business from its headquarters in Billerica, MA, more than 2,500 miles away from Tempe." ■
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