US: Cruzan sets date for Absolut merger vote
A shareholders meeting to decide whether Cruzan International should approve a merger deal with majority stakeholder Absolut Spirits has been called by the company's board of directors.
Florida-based Cruzan, which supplies rum, brandy and wine, has invited shareholders to vote on 17 March 2006, at 11:00 am.
Absolut, itself a subsidiary of Swedish company V&S Vin & Spirit AB, acquired its controlling 63.6% of Cruzan's common stock from rum and bitter producer Angostura in September 2005.
If the proposed merger is approved, Cruzan Acquisition will merge with and into Cruzan and outstanding stock worth US$0.01 per share will be converted into $28.37 per share in cash, with Cruzan then becoming a wholly owned subsidiary of Absolut and, indirectly, V&S Vin & Spirit AB.
In a letter to the shareholders, filed by the US Securities and Exchange Commission on Wednesday (15 February), Cruzan CEO and president Jay Maltby urged shareholders to pass the merger, stating: "The board of directors and the special committee both unanimously approved the merger agreement and the merger and both recommend that you vote 'for' approval."
The company also mentioned a US$3m termination fee in the filings, to be paid by Cruzan to Absolut in specified circumstances. Should Absolut terminate the merger in specified circumstances, Cruzan would reimburse the company with up to $1.5m for out-of-pocket expenses it has incurred.
Five members of Cruzan's board of directors resigned following the recommended merger agreement, on 30 September 2005, and four new directors were appointed in October, designated by Absolut.
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