Inventure Foods, Inc. (NASDAQ:SNAK) (“Inventure Foods” or the
“Company”), a leading specialty food marketer and manufacturer, and
Utz Quality Foods, LLC (“Utz”), the largest privately-held and
family-managed branded salty snack manufacturer and marketer in the
United States, today announced they entered into a merger agreement
pursuant to which Utz has agreed to acquire all of the Company’s
outstanding shares of common stock in an all-cash transaction.
Under the terms of the merger agreement, an indirect subsidiary
of Utz will commence a tender offer to acquire all of the
outstanding shares of the Company’s common stock at a price of
$4.00 per share in cash, for a total purchase price of
approximately $165 million, including the assumption of
approximately $75 million of debt and debt-like items, net of cash,
approximately $8 million of the Company’s estimated closing costs
and approximately $3 million due to equity award holders. The
acquisition is structured as an all-cash tender offer for all of
the outstanding shares of Inventure Foods common stock, to be
followed by a merger in which each remaining untendered share of
Inventure Foods will be converted into the right to receive the
same $4.00 per share cash price paid in the tender offer.
The transaction, which was unanimously approved by the Boards of
both Inventure Foods and Utz, is subject to the tender of more than
50 percent of the fully diluted shares of Inventure Foods common
stock, the receipt of certain regulatory approvals and other
customary closing conditions. The transaction is not subject to a
financing contingency and is expected to close by the end of the
fourth quarter of 2017. The tender offer is expected to
commence within ten business days.
“This transaction is the result of diligent analysis and
thoughtful strategic deliberations by our Board of Directors and
the result of the strategic and financial review we initiated in
July 2016,” stated Terry McDaniel, Chief Executive Officer of
Inventure Foods. “Our Board, with the advice of independent
advisors, determined that this transaction will deliver immediate
and certain cash value to our stockholders and new opportunities
for our snack brands.”
“We are tremendously excited about the opportunity to acquire
Inventure Foods,” said Dylan Lissette, Chief Executive Officer of
Utz Quality Foods. “The Company’s specialty snack food products and
brands, as well as its geographic footprint, customer relationships
and distribution strengths, are highly complementary to our
business and we look forward to continuing Inventure’s strong
heritage of innovation in both healthy and indulgent snacking. We
have also been extremely impressed with the team at Inventure, and
look forward to working together going forward.”
As previously announced, on September 29, 2017, the
Company entered into a Limited Waiver and Sixth Amendment to Credit
Agreement (the “Sixth Amendment”) with BSP Agency, LLC, as agent
(“BSP”), and the lenders (the “Lenders”) from time to time a party
to the Credit Agreement (defined below), which further amended the
Credit Agreement, dated as of November 18, 2015, among the
Borrowers a party thereto, the Lenders, and BSP (as amended from
time to time, the “Credit Agreement”). Under the terms of the
Sixth Amendment, the Lenders agreed to, among other things,
(i) a further extension from September 30, 2017 to
October 31, 2017 of the temporary waiver of the requirement
under the Credit Agreement to deliver audited financial statements
without a going concern opinion, and (ii) a temporary waiver
until October 31, 2017 of the financial covenants with which
the Company was required to comply under the Credit Agreement.
As a result of this transaction, BSP and the other Lenders have
agreed to further extend the temporary waivers from October 31,
2017 to January 15, 2018 pursuant to a Limited Waiver, Consent and
Seventh Amendment to Credit Agreement (the “Seventh Amendment”), in
order to give the Company sufficient time to complete the proposed
transaction. Without this further extension of the temporary
waivers beyond October 31st, the Company would have been in default
of the EBITDA financial covenants under the Credit Agreement and
the requirement to deliver audited financial statements without a
going concern opinion. Pursuant to the Seventh Amendment, the
Lenders have agreed to loan the Company up to an additional $5
million, which the Company may require to satisfy its expected
operating expenses through December 31, 2017.
The Company is represented in this transaction by its financial
advisor, Rothschild, and its legal counsel, DLA Piper LLP
(US). Inventure retained Rothschild as its financial advisor
in connection with a formal process to conduct a “strategic and
financial review” of the Company in July 2016. Utz Quality
Foods is represented in this transaction by its financial advisor,
Stephens Inc., and its legal counsel, Cozen O’Connor.
About Inventure Foods, Inc.With manufacturing
facilities in Arizona and Indiana, Inventure Foods, Inc.
(Nasdaq:SNAK) is a marketer and manufacturer of specialty food
brands in better-for-you and indulgent categories under a variety
of Company owned and licensed brand names, including Boulder Canyon
Foods™, TGI Fridays™, Nathan's Famous®, Vidalia Brands®, Poore
Brothers®, and Tato Skins®, Bob's Texas Style®. For further
information about Inventure Foods, please visit
www.inventurefoods.com.
About Utz Quality Foods, LLCFounded in 1921,
Utz® Quality Foods, LLC is the largest privately-held and
family-managed branded salty snack company in the United States,
producing a full line of products including potato chips, pretzels,
cheese snacks, corn chips, tortillas, veggie stix/straws, popcorn,
onion rings, pork skins and more. Its brands, which include
Utz®, Golden Flake®, Zapp’s®, “Dirty”® Potato Chips, Good Health®,
Bachman®, Bachman Jax®, Wachusett® and Snikiddy® among
others, are distributed nationally and internationally through
grocery, mass-merchant, club stores, convenience stores, drug
stores and other channels. Based in Hanover, PA, Utz operates
10 facilities located in Pennsylvania, Colorado, Louisiana,
Massachusetts and Alabama.
For information about Utz® or its products, please visit
www.utzsnacks.com or call 1-800-FOR-SNAX.
Note Regarding Forward-looking Statements
Any forward-looking statements, including, but not limited to,
statements regarding the proposed transaction between Inventure
Foods and Utz, the expected timetable for completing the
transaction, strategic and other potential benefits of the
transaction, and other statements about Inventure Foods or Utz
management’s future expectations, beliefs, goals, plans or
prospects, are subject to risks and uncertainties such as those
described in Inventure Foods’ periodic reports on file with the
Securities and Exchange Commission. These statements speak only as
of the date of this press release and are based on Inventure Foods
or Utz’s current plans and expectations and involve risks and
uncertainties that could cause actual future events or results to
be different from those described in or implied by such
forward-looking statements, including risks and uncertainties
regarding: changes in financial markets; changes in economic,
political or regulatory conditions or other trends affecting their
industries; and changes in facts and circumstances and other
uncertainties concerning the proposed transaction. Further
information about these matters can be found in Inventure Foods’
Securities and Exchange Commission filings. Inventure Foods’
cautions investors not to place considerable reliance on the
forward-looking statements contained in this press release. Except
as required by applicable law or regulation, Inventure Foods does
not undertake any obligation to update or revise any of their
forward-looking statements to reflect future events or
circumstances.
Important additional information will be filed with the
U.S. Securities and Exchange Commission
The tender offer for the outstanding shares of Inventure Foods
has not yet commenced. This press release is for informational
purposes only and is neither a recommendation, an offer to purchase
nor a solicitation of an offer to sell securities, nor is it a
substitute for the tender offer materials that Utz and its
acquisition sub (“Offeror”) will file with the U.S. Securities and
Exchange Commission (the “SEC”) upon commencement of the tender
offer. At the time the tender offer is commenced, the Offeror will
file tender offer materials on Schedule TO, and Inventure Foods
will file a Solicitation/Recommendation Statement on Schedule 14D-9
with the SEC with respect to the tender offer. THE TENDER OFFER
MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF
TRANSMITTAL AND CERTAIN OTHER TENDER OFFER DOCUMENTS) AND THE
SOLICITATION/RECOMMENDATION STATEMENT, AS THEY MAY BE AMENDED FROM
TIME TO TIME, WILL CONTAIN IMPORTANT INFORMATION. HOLDERS OF SHARES
OF COMMON STOCK OF INVENTURE FOODS ARE URGED TO READ THESE
DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION, INCLUDING THE VARIOUS TERMS OF, AND
CONDITIONS TO THE TENDER OFFER, THAT HOLDERS OF COMMON STOCK OF
INVENTURE FOODS SHOULD CONSIDER BEFORE MAKING ANY DECISION
REGARDING TENDERING THEIR SHARES. The Offer to Purchase, the
related Letter of Transmittal and certain other tender offer
documents, as well as the Solicitation/Recommendation Statement,
will be made available to all holders of common stock of Inventure
Foods at no expense to them. The tender offer materials, the
Solicitation/Recommendation Statement and other related documents
(when available) will be made available for free at the SEC’s
website at www.sec.gov.
Contacts:
For Inventure Foods, Inc.:
Katie Turner, ICR (646) 277-1200
or
For Utz Quality Foods:
George Neiderer, Utz SVP HR (717) 637-1759Kevin J. Brick, Utz
SVP Marketing (717) 637-1759
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