MONTREAL (BRAIN) — Dorel Industries Inc. has terminated a proposed transaction that would have taken the company off the stock exchange. The termination comes just a day before shareholders were set to vote on accepting the deal.
A group of executives backed by Cerberus Capital had offered to buy Dorel's outstanding shares for CA$16 ($12.60). Dorel owns Cannondale, Schwinn, and other brands.
The company said the termination came after discussions between Dorel and many of its shareholders as well as a review of proxy votes that were submitted before the weekend. The board voted unanimously to end the agreement after a special committee of six independent directors recommended it.
"Independent shareholders have clearly expressed their confidence in Dorel's future and the greater potential for Dorel as a public entity. We sincerely appreciate the considerable time and effort Cerberus has devoted to this project. I thank our employees who have maintained an unwavering focus on Dorel's operations throughout this period. Shareholder value enhancement remains our top priority and we look forward to continued growth with our excellent brands, worldwide consumer recognition and strong customer relations," said Dorel's president and CEO, Martin Schwartz, who was one of the executives behind the bid.
On Feb. 1, the purchasing group raised its offer for shares by 10% after a major investor group said it planned to vote against accepting the original offer.
