Books-A-Million has signed a definitive agreement in which Chairman Clyde B. Anderson, his family and all related persons and entities, will acquire the company.
The Anderson family controls 58% of Book-a-Million and first extended an offer to acquire all remaining shares for $2.75 per share in January 2015, according to The Wall Street Journal. For the current deal, the Anderson family has proposed that all shareholders — excluding the family and related persons and entities — will receive $3.25 per share in cash, or $21 million.
The final share price is a premium of 93% over the trade price of shares on Jan. 29, 2015, when the Anderson family made its first acquisition proposal. It also is a premium of 23% over the closing trading price on July 13, 2015.
Pending shareholder approval and other customary conditions, the Anderson family will finance the purchase through a combination of contributions of their own shares and any management rollover participants. The Anderson family also will borrow approximately $21 million under the company’s existing credit facilities.
After the Anderson family initially expressed interest in buying Books-A-Million in January 2015, the company’s Board of Directors formed a Special Committee of directors independent of the Executive Chairman. The Committee was charged with examining the proposal, determining whether the transaction was beneficial to current stockholders and moving forward with negotiations.
“We believe the transaction is a positive result for everyone, most importantly the company’s shareholders,” said Executive Chairman Anderson. “The Special Committee and its advisors have done a thorough job to assure that all terms and conditions are arms’ length, and we are pleased to have come to a fair and balanced agreement.”
However, shareholder rights attorneys at Robbins Arroyo LLP are investigating the new acquisition deal to ensure whether the Board of Directors are obtaining maximum value and adequately compensating current shareholders.