Winner Medical (WWIN) Enters 'Go Private' Deal at $4.50/Share

July 24, 2012 9:14 AM EDT
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Winner Medical Group Inc. (Nasdaq: WWIN) ("Winner Medical" or the "Company"), a leading China-based exporter and retailer of high-quality medical dressings and consumer products made from 100% cotton, today announced that the Company has entered into an Agreement and Plan of Merger (the "Merger Agreement") with Winner Holding Limited ("Parent"), a Cayman Islands exempted company with limited liability and indirectly wholly-owned by Mr. Jianquan Li, and Winner Acquisition, Inc., a Nevada corporation and a wholly-owned, direct subsidiary of Parent ("Merger Sub"). Mr. Jianquan Li is the Company's president, chief executive officer, chairman of the board of directors and principal stockholder.

Subject to satisfaction of the Merger Agreement's terms and conditions, upon consummation of the merger, Merger Sub will merge with and into the Company, with the Company continuing as the surviving corporation and a wholly-owned subsidiary of Parent (the "Merger"). Pursuant to the Merger Agreement, each of the Company's shares of common stock issued and outstanding immediately prior to the effective time of the merger (the "Shares") will be converted into the right to receive $4.50 in cash without interest, except for (i) Shares owned by Parent and Merger Sub, including shares to be contributed to Parent by Mr. Jianquan Li and Ms. Ping Tse (Mr. Li's wife) immediately prior to the effective time of the merger pursuant to a contribution agreement, dated as of July 24, 2012, among Parent, Glory Ray Holdings Limited, Mr. Jianquan Li and Ms. Ping Tse, and (ii) Shares held by the Company as treasury stock, which will be cancelled and retired and cease to exist as of the effective time of the merger. The offer represents a premium of 32.3% percent over Winner Medical's closing price of $3.40 per share on March 30, 2012, the last trading day prior to the Company's announcement of its receipt of a "going-private" proposal.

Parent has a secured debt facility from DBS Bank Ltd., Hong Kong Branch, with which it is financing the transactions contemplated by the Merger Agreement.

The Company's Board of Directors, acting upon the unanimous recommendation of a special committee of the Board of Directors comprised solely of independent and disinterested directors (the "Special Committee"), approved and adopted the Merger Agreement and has recommended that the Company's stockholders vote to approve the Merger Agreement. The Special Committee negotiated the terms of the Merger Agreement with the assistance of its financial and legal advisors.

The transaction, which is currently expected to close before the end of the first fiscal quarter of 2013, is subject to the approval of the Merger Agreement by an affirmative vote of stockholders of both (i) a majority of the outstanding shares of the Company's common stock and (ii) a majority of the outstanding shares of the Company's common stock not owned by Parent, Merger Sub, Mr. Jianquan Li or Ms. Ping Tse, voting in person or by proxy at a special meeting of stockholders of the Company.

The Company will call a special meeting of its stockholders for the purpose of voting on the adoption of the Merger Agreement. If completed, the transaction will result in the Company becoming a privately held company and its shares will no longer be listed on The NASDAQ Global Market.

William Blair & Company, L.L.C. is serving as financial advisor to the Special Committee. Cleary Gottlieb Steen & Hamilton LLP is serving as U.S. legal advisor to the Special Committee. Winston & Strawn LLP is serving as U.S. legal advisor to the Company. Skadden, Arps, Slate, Meagher & Flom LLP is serving as U.S. legal advisor to Mr. Jianquan Li. McDermott Will & Emery LLP is serving as U.S. legal advisor to William Blair & Company, L.L.C.

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William Blair, Winner Medical Group/CEO Jianquan Li

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