China ACM (CADC) Enters $2.65/Share Merger Agreement
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China Advanced Construction Materials Group, Inc. (Nasdaq: CADC), a leading provider of ready-mix concrete and related technical services in China, today announced that it has entered into a definitive agreement and plan of merger with Novel Gain Holdings Limited, a British Virgin Islands company, CACMG Acquisition, Inc., a Delaware corporation and a wholly owned, direct subsidiary of Novel Gain, Mr. Xianfu Han and Mr. Weili He, pursuant to which Merger Sub will merge with and into the Company with the Company continuing as the surviving corporation and a wholly owned subsidiary of Novel Gain. Mr. Han is the Company's Chief Executive Officer and the Chairman of the Company's Board of Directors and beneficially owns approximately 32.5% of the Company's outstanding shares of common stock, $0.001 par value per share. Mr. He is the Company's Chief Operating Officer and Vice-Chairman of the Company's Board of Directors and beneficially owns approximately 17.0% of the outstanding Company Common Stock.
Under the terms of the merger agreement, each share of the Company Common Stock issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive $2.65 in cash without interest, except for (i) shares in respect of which appraisal rights have been properly exercised under Delaware law, and (ii) shares owned by Novel Gain and Merger Sub (including shares to be contributed to Novel Gain by Messrs. Han and He pursuant to a rollover agreement between Novel Gain and the Rollover Investors immediately prior to the effective time of the merger), which shares will be cancelled without the Rollover Investors receiving any consideration. The offer represents a 43.2% premium over the closing price as quoted by Bloomberg L.P. on October 21, 2011 and a 37.7% premium over the 90-day volume weighted average price as quoted by Bloomberg L.P. as of the same date, on October 21, 2011.
Pillsbury Winthrop Shaw Pittman 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 the Special Committee. Squire, Sanders & Dempsey LLP is serving as U.S. legal advisor to Messrs. Han and He. William Blair & Company is serving as financial advisor to the Special Committee.
Under the terms of the merger agreement, each share of the Company Common Stock issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive $2.65 in cash without interest, except for (i) shares in respect of which appraisal rights have been properly exercised under Delaware law, and (ii) shares owned by Novel Gain and Merger Sub (including shares to be contributed to Novel Gain by Messrs. Han and He pursuant to a rollover agreement between Novel Gain and the Rollover Investors immediately prior to the effective time of the merger), which shares will be cancelled without the Rollover Investors receiving any consideration. The offer represents a 43.2% premium over the closing price as quoted by Bloomberg L.P. on October 21, 2011 and a 37.7% premium over the 90-day volume weighted average price as quoted by Bloomberg L.P. as of the same date, on October 21, 2011.
Pillsbury Winthrop Shaw Pittman 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 the Special Committee. Squire, Sanders & Dempsey LLP is serving as U.S. legal advisor to Messrs. Han and He. William Blair & Company is serving as financial advisor to the Special Committee.
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