Cadmus, Provenco merger terms tweaked

Technology firms Cadmus and Provenco have changed the terms of their proposed $140 million merger.

In a statement today the companies said the new proposal would see 4.2 Cadmus shares exchanged for 1 Provenco share. This ratio is in line with advice from independent expert Grant Samuel in a draft report provided to both companies. Grant Samuel considered a ratio of 4.2 to be fair to shareholders.

Previously it was planned that Cadmus shareholders' would receive one share in the combined company, which has yet to be named, for every 4.6 Cadmus shares they held. Provenco shareholders are in line for a one-for-one exchange of their shares for those in the combined firm.

Rick Christie, chairman of the proposed combined firm's board, said the new ratio reflected changes in both companies and their operating environments. It was a "fair and equitable" deal for shareholders of both.

"The merger ratio has been altered to reflect the trading of each company in the four months since the proposed merger was announced," Mr Christie said. "In particular, for Provenco shareholders, it reflects the volatility of the international operating environment of that company's retail automation division."

The deal has received Commerce Commission clearance.

Mr Christie said the next steps were to finalise the merger proposal documentation for shareholders in both companies.  This should be issued in mid-March with shareholder meetings for both firms to discuss the proposed deal following in early April.

- © Fairfax NZ News