Medicago Board of Directors votes in favor of buyout
The Medicago Board of Directors unanimously voted in favor of the buyout. An official meeting will, however, take on place on August 29 at 1000 de La Gauchetière Street West, Suite 2500, Montréal, Québec to determine the fate of the company.
If the vote is not for the whole ownership of the company to be held by Québec, a subsidiary of the Mitsubishi Tanabe Pharma Corporation, the price of the share will fall to $0.82 per common share.
"A vote for is warranted based on a review of the terms of the transaction and, in particular, the adequate premium to minority shareholders, the favourable market reactions and no significantly noted governance concerns," ISS representatives said.
Glass Lewis recently released a statement that said the proposition is fair for existing shareholders and offers them a reasonable return on their investments.
"In light of the company's small size, early stage and need for additional liquidity and capital to continue its operations beyond the next six months, and the risks of Medicago continuing on a stand-alone basis, we believe the proposed all-cash buyout is the best alternative for unaffiliated shareholders at this time," Glass Lewis representatives said. "In our opinion, the purchase price represents a fair and acceptable value at which shareholders can exit their investment in the company at a premium and immediately realize such value. Based on these factors, along with the unanimous support of the board, we believe the proposed acquisition is in the best interests of shareholders."