TORONTO - Teknion Corporation today announced that it has entered into an arrangement agreement with its controlling shareholder A-Tean Holdings Limited (“A-Tean”) and 2158436 Ontario Limited (“2158436”), an affiliate of A-Tean, pursuant to which 2158436 has agreed to acquire all of the subordinate voting shares (the “Shares”) of Teknion not owned by A-Tean and its affiliates for a price of $3.15 cash per Share (the “Transaction”). The terms of the arrangement agreement are consistent with the terms of the previously announced letter agreement relating to the Transaction entered into between 2158436 and Teknion on December 23, 2007. The cash purchase price represents a 120% premium over the 30 day volume weighted average trading price of the Shares at December 21, 2007, the last trading day prior to the public announcement by Teknion of the Transaction.
The Transaction will be carried out by way of a statutory plan of arrangement that is subject to court, shareholder and normal regulatory approvals. Teknion expects to hold a meeting of shareholders to consider the Transaction on or about Friday, February 22, 2008, and if approved, to complete the Transaction by the end of February. It is expected that a management information circular relating to the Meeting, containing the terms of the Transaction, will be mailed to Teknion’s shareholders by no later than January 31, 2008.
A-Tean and its affiliates own approximately 62% of the combined issued and outstanding multiple voting shares and subordinate voting shares of Teknion. Teknion was advised on December 23, 2007 that 2158436 had entered into agreements with certain institutions holding approximately 38% of the outstanding Shares, pursuant to which such shareholders committed to support the Transaction. Teknion has been further advised that 2158436 has entered into agreements with shareholders holding an additional 5.1% of the outstanding Shares, pursuant to which such shareholders have committed to support the Transaction. As a result of those agreements, Teknion believes that shareholders holding approximately 43% of the outstanding Shares have agreed with 2158436 to support the Transaction.
A special committee of independent directors of Teknion, consisting of Allen Karp, David Sanchez and George Taylor (the “Special Committee”), each of whom is independent of A-Tean and its affiliates and of management of Teknion, has reviewed the Transaction with its independent legal and financial advisors. In this regard, the Special Committee has received a valuation report and an opinion from TD Securities Inc. that, as of December 22, 2007, the consideration under the offer is fair, from a financial point of view, to the holders of the Shares other than A-Tean and its affiliated entities. The Board of Directors of Teknion (other than directors affiliated with A-Tean), upon the recommendation of the Special Committee, has unanimously approved the Transaction and recommends that shareholders vote in favour of the Transaction.
Teknion Corp. is a leading international designer, manufacturer and marketer of office systems and related office furniture products. Teknion’s headquarters are located in Toronto, Ontario. The company has offices and facilities in Canada, the United States, the United Kingdom and the Pacific Rim, and serves clients through a network of authorized dealers worldwide.
Source: Teknion Corp.
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