The Weyburn Inland Terminal CEO has advised the WIT Board he will be resigning five business days following the special meeting of WIT shareholders for the approval of the arrangement agreement with Parrish & Heimbecker.
WIT entered into the arrangement agreement with Parrish & Heimbecker where P&H will acquire all of the issued and outstanding common shares of WIT for cash consideration of $17.25 per share, representing total equity value on a fully diluted basis of approximately $94.6 million.
The $17.25 per share consideration represents a 33.7 per cent premium to the closing price on Thursday December 12, 2013, one day prior to WIT's announcement of its strategic review process, and a 28.3 per cent premium to the highest ever published trading price in WIT's history prior to the strategic review announcement. The transaction offers all WIT shareholders immediate liquidity at a compelling value. The shares of WIT trade on an over the counter market established by PI Financial Corp.
It is expected that WIT will mail to its shareholders an information circular with all the relevant information regarding the proposed plan of arrangement on February 6 and that the meeting will take place on or about February 28.
"The 15 years I have spent with WIT have been challenging but very satisfying" said WIT CEO Rob Davies. "The Board of Directors, the staff, the customers and the shareholders have built a tremendous business, and I will always appreciate the opportunity I had to be a part of this group. Our industry has evolved, and so has WIT. I am certain that the path forward with P&H that the directors have unanimously recommended shareholders accept is, absolutely, the right decision and that it will provide the best opportunity for both our staff and customers in the future."
WIT President Claude Carles noted that WIT is grateful for the leadership and vision that Davies has provided throughout his years at WIT, and expressed the appreciation of the board for his contribution. "Rob's insight and involvement in various agriculture industry associations and boards of directors, as well as Ag Canada task forces and working groups have provided the WIT Board with an inside view of the grain handling industry that has helped us to be successful" said Carles. "We thank him for his contributions and wish him and his family all the best in the future."
Parrish and Heimbecker is a Canadian family owned business with over 105 years of experience in the Canadian agri-food industry. P&H is Canada's second largest flour miller consuming over 1 MMT of wheat annually. The company has 32 line elevators spread across Canada, a supply chain management for logistics through eight terminal locations on both the west coast and through the Great Lakes/St. Lawrence Seaway, as well as participation in both food and feed manufacturing.
"The board of directors of WIT believes that this agreement is highly attractive to all stakeholders. It offers shareholders a substantial premium and a fully-funded all cash offer. It also brings in a large Canadian operator with an outstanding track record and international export capabilities, ensuring the success of WIT and the local producer community for years to come," said Davies.
WIT's Board of Directors, with the benefit of advice from its financial and legal advisors, have unanimously determined that the arrangement is in the best interests of WIT and recommend that shareholders vote in favor of the transaction.
In making this recommendation, the board of directors considered a number of benefits of the transaction, including the fact that it meets its two previously stated key objectives of maximizing value and liquidity for WIT shareholders, and providing a strong competitive environment for WIT's customers as the company's business environment continued to evolve. The connection with P&H's export markets and large base of Canadian flour mills will provide a strong, local competitive option for farm customers.
"We see tremendous potential in WIT and are excited to announce this partnership with south-eastern Saskatchewan producers," said John Heimbecker, Vice President of P&H. "WIT will fit very well within P&H's existing network of grain assets, and the level of service the WIT team provides across its grain, crop inputs, livestock feed and special crops businesses will be welcomed within the P&H family. We expect the proposed acquisition to be beneficial both to producers and the Weyburn community."