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Service Corporation International Announces Support Agreement With Keystone North America Inc.
The offer price represents a 38% premium to Keystone's most recent 50-day average share price and is conditioned upon, among other things, the tender of at least two-thirds of the outstanding shares of Keystone's common shares, calculated on a fully diluted basis. The Boards of Directors of both companies have unanimously approved the transaction.
The transaction is anticipated to close in the first quarter of 2010, subject to customary closing conditions, including expiration of the waiting period under the Hart-Scott-Rodino Antitrust Act. SCI has substantial cash on hand which will be used in the transaction and has also received a commitment letter from
SCI, headquartered in
Keystone, headquartered in
"Our current portfolio has over 300 similarly positioned businesses which consistently generate solid margins and predictable cash flows," said SCI President and CEO
"The migration of the Baby-Boomer generation to suburban and rural areas over the coming years will represent a significant opportunity for growth," added SCI Executive Vice President and Chief Operating Officer
Keystone President and CEO
"As demonstrated with our purchase of Alderwoods in 2006, we have a proven capability of successfully integrating large acquisitions," concluded Ryan. "I applaud the SCI team and thank them in advance for their efforts."
Information set forth in this release contains forward-looking statements, which involve a number of risks and uncertainties. SCI cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such forward-looking statements include, but are not limited to, statements about the benefits of the business combination transaction involving SCI and Keystone, including future financial and operating results, the anticipated timing of the closing of the transaction, the combined company's plans, objectives, expectations and intentions and other statements that are not historical facts.
The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the ability to obtain regulatory approvals of the transaction on the proposed terms and schedule; the failure to achieve the minimum tender condition in the tender offer; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers. Additional factors that may affect future results are contained in SCI's filings with the
IMPORTANT ADDITIONAL INFORMATION
A take-over bid circular containing the terms of the offer will be mailed to Keystone shareholders, together with Keystone's directors' circular unanimously recommending acceptance of the offer, on or before
The Support Agreement entered into between SCI and Keystone provides for, among other things, a non-solicitation covenant on the part of Keystone, customary "fiduciary out" provisions which entitle Keystone to consider and accept a superior proposal, SCI's right to match and the payment to SCI of a break fee in an amount and in circumstances that is typical for a transaction of this nature.
For additional information contact: