YoCream Signs Agreement to be Acquired by Danone
Press Release Source: YoCream International, Inc. On Wednesday November 24, 2010, 1:30 am EST
PORTLAND, Ore., Nov. 24, 2010 /PRNewswire-FirstCall/ -- YoCream International, Inc. (Pink Sheets:YOCM.pk - News), pioneers in the frozen yogurt industry, today announced that it has entered into a definitive merger agreement with Danone, the world's leading fresh dairy products company, under which a subsidiary of Danone will merge with YoCream, and each outstanding share of YoCream common stock will be converted into the right to receive approximately $39.82 per share in cash (subject to adjustment as described below) representing an enterprise value of YoCream of approximately $103 million. This per share purchase price represents a premium of 38.5% over YoCream's 60-day volume weighted average stock price.
The Board of Directors of YoCream, acting on the recommendation of a special committee comprised solely of independent directors, has unanimously approved the transaction and recommends that all YoCream shareholders vote their shares to approve the merger.
John Hanna will remain CEO and a director of YoCream following the closing of the transaction and the Company's senior management team will also remain. They, along with one former board member, will retain an ownership interest of approximately 5% in the Company following the closing. The name of the Company will remain YoCream International following the closing.
John Hanna, co-founder and chief executive officer of YoCream stated that, "The Company has been exploring various opportunities for continued growth for some time. This transaction benefits our shareholders by providing them with the opportunity to receive a significant premium for their YoCream shares, and joining the Danone Group represents a natural progression in our corporate achievement to provide healthful live and active cultured frozen yogurt to consumers in the US and abroad." Hanna added, "We have continued our strong track record of innovation in this category and appreciate that Danone has recognized our leadership role for frozen yogurt in the foodservice industry."
The purchase price is subject to adjustment depending on the amounts of YoCream's net indebtedness and net working capital at closing, and approximately 1.5% of the purchase price will be retained in escrow for up to 90 days to satisfy this adjustment and approximately 10% of the purchase price will be retained for up to two years to satisfy any post-closing indemnification claims.
YoCream expects the transaction to close before December 28, 2010. If the closing does not occur by the end of the year because of failure to obtain the required regulatory clearances, YoCream shareholders will receive an additional $0.97 per share if capital gains tax rates are higher on April 15, 2011, than they were on December 31, 2010.
The transaction is subject to the satisfaction of customary closing conditions, as well as the approval of YoCream's shareholders. YoCream shareholders holding approximately 77% of YoCream's outstanding shares of common stock have agreed to vote their shares in favor of the merger (so long as the merger agreement remains in effect) at a special meeting of YoCream shareholders, which is expected to be held in late December. The Company will distribute a proxy statement to all its shareholders in the near future, which will contain more detailed information about the transaction. Shareholders should read this proxy statement carefully. D.A. Davidson & Co. is serving as YoCream's investment banking advisor and rendered a written fairness opinion to YoCream's board of directors in conjunction with the transaction.
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