- THE MAGAZINE
- CSTD MAGAZINE
Rock of Ages Corp. announced that it has entered into a definitive merger agreement with Swenson Granite Company LLC (“Swenson Granite”) whereby shareholders of Rock of Ages will receive $5.25 per share in cash, and Swenson Granite will acquire 100 percent ownership of Rock of Ages.
Rock of Ages (www.RockofAges.com) is the largest integrated granite quarrier and manufacturer of finished granite memorials and granite blocks for memorial use in North America.
The Rock of Ages Board of Directors, based in part on the unanimous recommendation of a special committee of three Rock of Ages independent directors, unanimously adopted, and recommends that shareholders of the Company vote for approval of, the merger agreement. The special committee’s independent financial advisor has delivered an opinion to the effect that the $5.25 per share to be received by Rock of Ages shareholders in the merger is fair, from a financial point of view, to such shareholders. The $5.25 per share price represents a 57 percent premium to the average closing price of Rock of Ages Class A common stock for the 30 days prior to the May 7, 2010 announcement of Swenson Granite’s initial proposal to acquire 100 percent ownership of Rock of Ages, and a 84 percent premium to the average closing price for the 12 months prior to the May 7, 2010 announcement.
Kurt Swenson, the Chairman of Swenson Granite and non-executive Chairman of Rock of Ages, together with his brother, Kevin Swenson, Vice President of Swenson Granite, and Robert Pope, President and Chief Executive Officer of Swenson Granite, own approximately 71 percent of Swenson Granite. They, along with certain other members of Swenson Granite who are also Rock of Ages shareholders, have agreed with Swenson Granite to vote their shares, representing approximately 81percent of the total voting power of all Rock of Ages shares, in favor of approval of the merger agreement.
The merger agreement includes various other customary conditions, but does not contain a financing condition. People’s United Bank and Key Bank, National Association have committed, subject to customary conditions, to provide debt financing for the transaction.
Prior to the merger, Kurt Swenson, Kevin Swenson, Robert Pope and certain other members of Swenson Granite - who are also shareholders of Rock of Ages - will contribute to Swenson Granite a total of 258,326 Class A shares and 2,449,793 Class B shares of Rock of Ages in exchange for additional shares of membership interest in Swenson Granite, and will not receive the $5.25 per share cash merger price for those Rock of Ages shares.
Covington Associates, LLC served as financial advisor to the special committee of the Rock of Ages board of directors and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor to the special committee. Sheehan Phinney Bass + Green PA served as legal counsel to Swenson Granite.