TIDMTYR TIDMTYRU
RNS Number : 2563C
TyraTech, Inc.
28 September 2018
For immediate release: 28 September 2018
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the
Transaction with the result that certain persons became aware of
inside information (as defined in MAR), as permitted by MAR. This
inside information is set out in this Announcement. Therefore,
those persons that received inside information in a market sounding
are no longer in possession of such inside information relating to
the Company and its securities.
TYRATECH, INC.
("TyraTech" or the "Company")
Conditional Merger Agreement Signed with American Vanguard
Corporation ("AMVAC") for the acquisition by AMVAC of all of the
shares in TyraTech it does not already own
TyraTech, Inc. (AIM: TYR), a life sciences company focused on
nature-derived insect and parasite control products, is pleased to
announce that it has entered into a conditional merger agreement
(the "Merger Agreement") with American Vanguard Corporation,
whereby, conditional upon approval by TyraTech shareholders, AMVAC
would acquire the remaining shares of common stock in TyraTech (the
"Shares") which it does not already own, for a consideration of
3.15 pence per Share (the "Transaction"). A meeting of TyraTech
shareholders (the "Special Meeting") will be convened at which a
simple majority of the entire issued share capital of the Company
entitled to vote and a 75% majority of the votes actually cast at
the meeting is required to approve the Transaction (the "Required
Shareholder Vote"). The independent directors of TyraTech (being
the Board of Directors of the Company other than Eric Wintemute)
(the "Independent Directors") intend to recommend that the
Company's shareholders vote in favour of the resolutions to be
proposed at the Special Meeting.
Key terms of the Merger Agreement
TyraTech is incorporated in the State of Delaware in the USA.
The Transaction is proposed as a merger in accordance with the laws
of Delaware. The Transaction is not subject to the UK City Code on
Takeovers and Mergers.
Pursuant to the terms of the Merger Agreement, TyraTech
shareholders would be entitled to receive 3.15 pence in cash for
each Share that they hold in the Company at the time of filing of a
certificate of merger with the Secretary of State of the State of
Delaware in relation to the Transaction (the "Effective Time"). The
consideration represents a 40% premium over the 2.25p mid-market
price of the Company's restricted stock (TYR) and a 54% premium
over the 2.05p mid-market price of the Company's unrestricted stock
(TYRU) at the close of business on 27 September 2018.
This would return a further GBP3.3 million to non-AMVAC
shareholders, in addition to the consideration returned in January
of this year via a tender offer at 3 pence per Share.
The Transaction is subject to certain closing conditions
specified in the Merger Agreement (the "Conditions"), including the
approval of TyraTech's shareholders for both the Transaction and
the resulting cancellation of the admission of the Shares to
trading on AIM (the "Cancellation"). Further details of the
Conditions are set out in the Appendix to this announcement.
Importance of vote
Should TyraTech shareholders not approve the Transaction, the
Independent Directors believe that the fragile financial situation
of the Company is not sustainable. The only credible alternative
courses of action would be to reduce expenditure as far as
possible, maximise the value from the sale of Company's remaining
assets on an individual basis and liquidate the Company. However,
given the Company's existing liabilities, its limited cash
resources and the uncertainty as to whether its assets could be
sold at all and at what price, this is an alternative that carries
much risk. The Independent Directors believe little, if anything,
would be available for return to TyraTech shareholders.
Background to and reasons for the Transaction
In January 2018, following the disposal of the Vamousse(R)
product range to Alliance Pharmaceuticals PLC, the Company returned
US$8.4 million to shareholders by way of a tender offer at 3 pence
per Share, which represented a substantial premium to the market
price of the TyraTech Shares immediately before the disposal.
At that time, the TyraTech Board stated that it believed that
the Company's animal health business was capable of being developed
to serve much larger markets than its human health products, but
that this would require additional funding. The increase in sales
during the first half of 2018 compared with the same period in 2017
showed the market need for the kind of products developed by the
Company, but the level of income generated from the animal health
products will not support the commercial and R&D investments
required to develop products with much larger market potential. The
Company had losses from continuing operations of US$4,354,000 in
the year ended 31 December 2017 and total assets of US$16,266,000
as at 31 December 2017.
Despite much work by the management and the TyraTech Board
exploring both public and private markets, the Company has not
found it possible to raise funds at the required levels to progress
these opportunities. Investors were not receptive for funding an
early stage company.
The Independent Directors therefore decided to enter into the
conditional Merger Agreement with AMVAC whereby AMVAC would acquire
the remaining Shares in the Company that it does not already own
for 3.15 pence per Share.
AMVAC and Related Party Transaction
AMVAC is a diversified specialty and agricultural products
company that develops and markets products for crop protection and
management, turf and ornamentals management and public and animal
health. AMVAC is included on the Russell 2000(R) and Russell
3000(R) Indexes and the Standard & Poor's Small Cap 600
Index.
For the purposes of the AIM Rules, AMVAC is treated as a related
party to the Company as it currently owns 34.38 percent of the
Company's voting share capital.
The Independent Directors (being the members of the TyraTech
Board, other than Eric Wintemute, who is Chairman and Chief
Executive Officer of AMVAC) consider, having consulted with Spark
Advisory Partners Limited, its nominated adviser, that the terms of
the Merger Agreement and the Transaction are fair and reasonable
insofar as TyraTech shareholders are concerned.
Further details of the Transaction
In accordance with the AIM Rules, approval of the Cancellation
requires the passing of a resolution of the TyraTech shareholders
by not less than 75% of votes cast by the Company's shareholders in
person or by proxy at the Special Meeting. Such approval is in
addition to the shareholder approval of the Merger Agreement, which
requires approval by the TyraTech shareholders holding a majority
of the Shares outstanding and entitled to vote on the record date
for such vote.
If approved, the Transaction is expected to complete during
November 2018. The Merger Agreement will terminate and the
Transaction will not proceed if the Transaction has not completed
by 15 December 2018. Upon completion of the Transaction, a newly
incorporated wholly owned subsidiary of AMVAC ("Merger Sub") will
be merged with and into TyraTech, with TyraTech as the surviving
entity (the "Surviving Corporation"), as a wholly owned subsidiary
of AMVAC. At the Effective Time, the AMVAC-appointed directors of
Merger Sub will become the directors of the Surviving Corporation,
and the current officers of TyraTech will become the initial
officers of the Surviving Corporation.
At least twenty business days prior to the Effective Time of the
Transaction, TyraTech intends to make an application to London
Stock Exchange plc for the Cancellation to take effect from 7.00
a.m. (London time) on the business day after the Effective Time. It
is expected that the last day of dealings in the Shares prior to
their suspension from AIM, and the last day for registration of
transfers of Shares, will be 5 November 2018.
The expected timetable of principal events is set out below.
Such times and dates are subject to change. Any such change will be
notified by an announcement on a Regulatory Information
Service.
Termination Fee
Prior to the adoption of the Merger Agreement by TyraTech's
shareholders, under certain circumstances, TyraTech's Board of
Directors (acting through the Independent Directors or otherwise)
may respond to an unsolicited written proposal for an alternative
acquisition or terminate the Merger Agreement and enter into an
acquisition agreement with respect to a superior proposal, so long
as TyraTech complies with certain terms of the Merger Agreement
including, if required, paying a termination fee of US$400,000 to
AMVAC.
Stock Appreciation Rights and Warrants
TyraTech's outstanding stock appreciation rights granted under
its 2007 Equity Compensation Plan ("Company SAR") will be cancelled
at the Effective Time. In exchange, each "in the money" Company SAR
will be converted into the right to receive a payment, in cash,
equal to the number of Shares underlying the Company SAR multiplied
by the amount (if any) by which 3.15p per Share exceeds the
applicable per share base amount, less applicable withholding
taxes. Each "out of the money" Company SAR will be cancelled at the
Effective Time for no consideration.
Similarly, TyraTech's outstanding warrants to purchase Shares
("Company Warrant") shall be cancelled at the Effective Time and
converted into the right to receive cash in an amount equal to the
product of (a) 3.15 pence less the per share exercise price of such
Company Warrant and (b) the number of Shares subject to such
Company Warrant.
Proxy Statement
TyraTech will send to its shareholders a shareholder circular,
known as a Proxy Statement, seeking their approval of the
Transaction. The Proxy Statement will contain important information
about the proposed Transaction and related matters and will also
include a notice convening the Special Meeting.
SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT CAREFULLY
WHEN IT BECOMES AVAILABLE AND PROMPTLY RESPOND IN ACCORDANCE WITH
THE INSTRUCTIONS PROVIDED THERIN.
The Proxy Statement will be posted to all persons who are
holders of record of TyraTech Shares as of the close of business on
28 September 2018. Shareholders will also be able to obtain free
copies of the Proxy Statement (when it is available) and other
documents notified by the Company in accordance with the AIM Rules
for Companies through the Company's website at www.tyratech.com. In
addition, shareholders will be able to obtain free copies of the
Proxy Statement from the Company's Registrars, Computershare
Investor Services (Jersey) Limited in the UK, telephone number +44
(0) 370 707 4040 and from the Company by contacting Erica Boisvert
by telephone at +1 919 415 4287.
Under Delaware law which governs the Transaction, a majority of
all the issued Shares entitled to vote is required for approval of
the acquisition of the Company by AMVAC. Historically, voting
levels from smaller shareholders in the UK have been low, and so
the Independent Directors urge all shareholders to read the Proxy
Statement carefully once it has been issued and return their
completed proxy cards promptly after receipt.
Commenting on the Transaction, José Barella, Chairman of the
Company said:
"In December 2017 when writing to shareholders concerning the
disposal of Vamousse and the return of capital to TyraTech
shareholders, we explained that we believed that the Company's
animal health business was capable of being developed to serve much
larger markets than its initial products, but that this would
require additional funding. However, this funding has not been
forthcoming.
Accordingly, we have decided to enter into the conditional
Merger Agreement with AMVAC. The proposed consideration of 3.15
pence per Share represents a significant premium over the Company's
current share price and is in addition to the US$8.4m already
returned to shareholders through the Tender Offer in January of
this year. The Independent Directors believe TyraTech's
shareholders, employees and business will be better positioned
following the Company's acquisition by AMVAC than if TyraTech had
remained as an independent entity."
Expected timetable of principal events
Proxy Statement and Form of 5 October 2018
Proxy posted to shareholders
General Meeting 10.00 a.m. EST on 26 October
2018
Last Day for dealings in Shares 5 November 2018
on AIM and Effective Time of
the Transaction
Cancellation of trading of Shares 7.00 a.m. GMT on 6 November
on AIM 2018
All changes to the expected timetable set out above will be
notified by the Company through a Regulatory Information Service.
For further information:
TyraTech Inc.
Bruno Jactel, Chief Executive Tel: +1 919 415 4340
Officer
Erica H. Boisvert, Chief Financial Tel: +1 919 415 4287
Officer
www.tyratech.com
SPARK Advisory Partners Limited
(Nominated Adviser)
Matt Davis / Vassil Kirtchev Tel: +44 203 368 3550
WH Ireland Limited (Broker)
Adrian Hadden / Chris Viggor Tel: +44 20 7220 1666
Belvedere Communications (PR)
John West / Kim van Beeck Tel: +44 20 3567 0510
Additional information
This Announcement is for information only and does not
constitute an offer or invitation to underwrite, subscribe for or
otherwise acquire or dispose of any securities or investment advice
in any jurisdiction, including without limitation, the United
Kingdom, the United States, Australia, Canada or Japan. Persons
needing advice should consult an independent financial adviser.
The distribution of this Announcement in certain jurisdictions
may be restricted by law. Persons into whose possession this
announcement comes are required to inform themselves about, and to
observe, such restrictions. Any failure to comply with these
restrictions may constitute a violation of the securities laws of
any such jurisdiction.
SPARK Advisory Partners Limited served as exclusive financial
advisor to TyraTech and provided a fairness opinion to the
Independent Directors. SPARK Advisory Partners Limited, which is
authorised and regulated in the United Kingdom by the Financial
Conduct Authority, is acting exclusively for the Company and no one
else in connection with the Transaction and will not be responsible
to anyone other than the Company for providing protections afforded
to clients of the Company.
Appendix
CONDITIONS TO CONSUMMATION OF THE TRANSACTION
The Transaction is conditional upon:
(a) The Company having obtained the Required Shareholder Vote at
the Special Meeting (including any adjournment or postponement
thereof).
(b) There not having been in effect any law, temporary
restraining order, executive order, notice, decree, ruling,
judgment or injunction or other order of a court or Governmental
Entity of competent jurisdiction preventing the Transaction from
being consummated.
(c) (i) All applicable waiting periods relating to the
Transaction having expired or been terminated, and (ii) any consent
or approval required by any other Governmental Entity having been
obtained.
(d) (i) The representations and warranties of AMVAC contained in
the Merger Agreement (other than those relating to Merger Sub)
having been true and correct when made and at and as of the
Effective Time with the same effect as though made as of the
Effective Time except (x) for changes expressly permitted by the
terms of the Merger Agreement, (y) that the accuracy of
representations and warranties that by their terms speak as of the
date of the Merger Agreement or some other date will be determined
as of such date and not as of the Effective Time, and (z) where any
such failure of the representations and warranties in the aggregate
to be true and correct would not constitute a Parent Material
Adverse Effect (without giving effect to any "materiality" or
"Parent Material Adverse Effect" qualifications contained therein);
and (ii) the representations and warranties of AMVAC relating to
Merger Sub having been true and correct in all respects both when
made and at and as of the Effective Time except (x) for changes
specifically permitted by the terms of the Transaction, and (y) the
accuracy of representations and warranties that by their terms
speak as of the date of the Merger Agreement or some other date
will be determined as of such date; and the Company shall have
received a certificate executed by a senior executive officer of
AMVAC on its behalf to the foregoing effect.
(e) AMVAC and Merger Sub shall have performed and complied with
in all material respects their obligations under the Merger
Agreement to be performed or complied with on or prior to the
Effective Time, and the Company shall have received a certificate
executed by a senior executive officer of AMVAC to the foregoing
effect.
(f) Since the date of the Merger Agreement, there shall not have
occurred and be continuing any Parent Material Adverse Effect.
(g) (i) The representations and warranties of the Company
contained in the Merger Agreement (other certain fundamental
warranties) having been true and correct when made and at and as of
the Effective Time with the same effect as though made as of the
Effective Time, except (x) for changes expressly permitted by the
terms of the Merger Agreement, (y) that the accuracy of
representations and warranties that by their terms speak as of the
date of the Merger Agreement or some other date will be determined
as of such date, and (z) where any such failure of the
representations and warranties in the aggregate to be true and
correct does not and would not constitute a Company Material
Adverse Effect (without giving effect to any "materiality" or
"Company Material Adverse Effect" qualifications contained
therein); and (ii) certain fundamental warranties of the Company
shall be true and correct in all respects, both when made and at
and as of the Effective Time, and (iii) the representations and
warranties of the Company relating to its share capital shall be
true and correct in all respects both when made and at and as of
the Effective Time and except for such inaccuracies that in the
aggregate would not result in an aggregate increase in the
consideration paid in excess of $25,000 (such increase determined
taking into account any surrender of shares or payment or
reimbursement made to AMVAC by any stockholder of the Company prior
to the Effective Time in order to cure such failure of the
condition to be satisfied); and AMVAC shall have received a
certificate executed by a senior executive officer of the Company
on its behalf to the foregoing effect.
(h) The Company shall have performed and complied with in all
material respects its obligations under the Merger Agreement to be
performed or complied with on or prior to the Effective Time, and
AMVAC shall have received a certificate executed by a senior
executive officer of the Company to the foregoing effect.
(i) Since the date of the Merger Agreement, there shall not have
occurred and be continuing any Company Material Adverse Effect.
(j) There shall not be pending any action or proceeding by any
Governmental Entity challenging or seeking to make illegal, to
delay materially or otherwise directly or indirectly to prohibit
the consummation of the Transaction.
The parties may waive certain of the Conditions as set out in
the Merger Agreement.
The following words and phrases used in this Appendix have the
following meanings:
"Company Material Adverse Effect" means any event, development,
change, effect or state of facts that, individually or in the
aggregate, has had or would reasonably be expected to have a
material adverse effect in or on the condition (financial or
otherwise), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole except as such
customary provisions detailed in the Merger Agreement.
"Governmental Entity" means any governmental entity, including
any U.S. federal, state or local, or foreign government, or any
legislature, or governmental subdivision, department, agency,
regulatory or administrative body, board, commission, court,
tribunal or other instrumentality.
"Parent Material Adverse Effect" means a material adverse effect
on the ability of AMVAC or Merger Sub to consummate the Transaction
and other transactions contemplated by the Merger Agreement.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
AGRLRMTTMBTTTPP
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