- Filing of certain prospectuses and communications in connection with business combination transactions (425)
December 03 2009 - 7:09AM
Edgar (US Regulatory)
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Filed
by ICO, Inc.
Pursuant
to Rule 425 under the Securities
Act
of 1933 and deemed filed pursuant Rule
14a-12
under the Securities Exchange Act of
1934
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Subject
Company: ICO, Inc.
Commission
File No.: 001-08327
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[Email
message from A. John Knapp, Jr., President and Chief Executive
Officer
of ICO,
Inc. to employees of ICO, Inc. and its Subsidiaries]
To ICO
team members across the globe
December
2, 2010
This
evening, we announced that ICO is being acquired by A Schulman, pending approval
by shareholders and customary regulatory agencies. This proposed
transaction reflects the value that each of you have helped to build in our
business. Our Board of Directors reviewed our alternatives for our
company and determined that the offer by Schulman was in the best interests of
our employees, customers, and shareholders. It is important that each
of you understands that this is a complimentary combination with very little
“overlapping” activities.
We
believe that ICO’s team members should be very excited about this combination,
based on the same considerations that have impressed our board with regard to A.
Schulman:
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1)
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Schulman’s financial strength
and expected ability to weather further economic
headwinds:
Schulman has a very strong balance sheet, and
it will continue to be very strong after the acquisition of
ICO. Balance sheets are important to customers and suppliers,
and provide the capital for both expansion and further
acquisitions. While our own balance sheet is good, it does not
provide as much flexibility for acquisitions and other new opportunities
which we expect with the balance sheet of the combined
company.
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2)
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Schulman’s reputation and the
quality of its management team:
Schulman has a good reputation in
Europe in masterbatch, engineered plastics, and
distribution. In Mexico, Schulman has a terrific reputation in
these areas. In Asia, Schulman has a growing
reputation. Schulman’s reputation in the United Sates is
improving rapidly, as the new management team focuses its
efforts. We have a regard for that management team and its
leadership here in the US, Europe and Mexico. We believe you
will grow to share that regard as each of you gets to know the Schulman
team.
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3)
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ICO fits with Schulman, both
geographically and in product markets
: We believe that
this is a remarkable combination. Regarding rotomoulding, masterbatch and
producer services, Schulman is strong in Europe and Mexico, but less
present in the United States and South America, where ICO can
help. Both companies are targeting growth in the Asia Pacific
markets, including India. So the geographic fit is close to
ideal. As to products, Schulman has a publicly stated goal of
being the global leader in masterbatch for film/packaging, which plays to
the strength of Bayshore. Schulman has further declared its
intent to be the global leader to rotomolding powders, which plays to
ICO’s strength in both Europe and Asia Pacific. So the product
market fit is close to ideal; both Bayshore and our roto powder expertise
are important to Schulman.
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Our
conclusion is that this transaction will bring significant value and opportunity
to our customers through enhanced product offerings, an expanded global reach,
improved financial strength, shared technology and product
development. If the combination is good for our customers, it should
also be good for our employees.
It is
also a fair transaction for our shareholders. Many of you who have
been with ICO or our affiliates for a number of years are shareholders in
ICO. Shareholders will receive a combination of cash and shares in
Schulman.
Over the next few weeks, we will be
engaged in the process of seeking regulatory approvals for the
transaction. We will also schedule a meeting of our shareholders who
will vote on the merger. Assuming that the regulatory approvals have
been obtained by the date of the shareholder meeting, if the transaction is
approved, the transaction close and the merger will become effective on or
shortly following the meeting.
There is
a great deal of strategy and planning that will take place over the coming
weeks and months. It is too early to comment on changes that will take place at
either ICO or Schulman. During this period, I hope that each of you
will have the opportunity to meet a few of the people at Schulman, and learn, as
I have, that they are dedicated, energetic, and professional.
A.
John Knapp, Jr.
President
and CEO
ICO,
Inc.
1811
Bering Drive, Suite 200
Houston,
TX 77057
Forward-Looking
Statements
Certain matters discussed in this
document are “forward-looking statements,” involving certain risks,
uncertainties, and assumptions, intended to qualify for the safe harbors from
liability established by the Private Securities Litigation Reform Act of 1995.
The Company’s statements regarding trends in the marketplace, potential
future
results,
and statements regarding the merger (including the valuation, benefits, results,
effects and timing thereof), the combined company and attributes thereof, and
whether and when the transactions contemplated by the merger agreement will be
consummated are examples of such forward-looking statements. The
following is a non-exclusive list of risks and uncertainties, and circumstances
that present risks, that could cause the forward-looking statements; the failure
to receive the approval of the Company’s shareholders; satisfaction of the
conditions to the closing of the merger; costs and difficulties related to
integration of businesses and operations; delays, costs and difficulties
relating to the merger and related transactions; results of cash/stock elections
of shareholders; restrictions imposed by the Company’s outstanding indebtedness;
changes in the cost and availability of resins (polymers) and other raw
materials; changes in demand for the Company's services and products; business
cycles and other industry conditions; general economic conditions; international
risks; operational risks; currency translation risks; the Company’s lack of
asset diversification; the Company’s ability to manage global inventory, develop
technology and proprietary know-how, and attract and retain key personnel;
failure of closing conditions in any transaction to be satisfied; integration of
acquired businesses; as well as risk factors and other factors detailed in the
Company's and A. Schulman’s respective most recent form 10-K and other filings
with the Securities and Exchange Commission.
Should one or more of such risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those indicated. Any
forward-looking statements are made only as of the date of this document, and
the Company undertakes no obligation to publicly update any such forward-looking
statements to reflect subsequent events or circumstances.
Additional
Information
In connection with the proposed merger,
A. Schulman and the Company intend to file materials relating to the transaction
with the Securities and Exchange Commission (“SEC”), including a registration
statement of A. Schulman, which will include a prospectus of A. Schulman and a
proxy statement of the Company. INVESTORS AND SECURITY HOLDERS
OF THE COMPANY ARE URGED TO CAREFULLY READ THE REGISTRATION STATEMENT AND THE
PROXY STATEMENT/PROSPECTUS AND ANY OTHER MATERIALS REGARDING THE PROPOSED MERGER
WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT A. SCHULMAN, THE COMPANY AND THE PROPOSED TRANSACTION. Investors and
security holders may obtain a free copy of the registration statement and the
proxy statement/prospectus when they are available and other documents
containing information about A. Schulman and the Company, without charge, at the
SEC’s web site at www.sec.gov. Copies of A. Schulman’s SEC filings
may also be obtained for free by directing a request to Investor Relations
Department at
330-668-7302. Copies
of the Company’s SEC filings may also be obtained for free by directing a
request to Investor Relations Department at 713-351-4100. The Company
expects to file a Current Report on Form 8-K that will contain additional
information with regard to the merger.
Participants
in Solicitation
A. Schulman and the Company and their
respective directors and executive officers may be deemed to be participants in
the solicitation of proxies from the Company’s stockholders in respect of the
merger. Information about these persons can be found in A. Schulman’s proxy
statement relating to its 2009 Annual Meeting of Stockholders, as filed with the
SEC on November 6, 2009, A. Schulman’s Current Reports on Form 8-K, as filed
with the SEC on September 2, 2009 and October 30, 2009, the Company’s proxy
statement relating to its 2009 Annual Meeting of Shareholders, as filed with the
SEC on January 23, 2009, and the Company’s Current Reports on Form 8-K, as filed
with the SEC on December 11, 2008, January 22, 2009, May 12, 2009 and August 6,
2009. These documents can be obtained free of charge from the sources
indicated above. Additional information about the interests of such
persons in the solicitation of proxies in respect of the merger will be included
in the registration statement and the proxy statement/prospectus to be filed
with the SEC in connection with the proposed
transaction.
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