Montpellier,
France
September 13, 2005
European
Sakata Holding SAS, a subsidiary of
Sakata Seed Corporation,
Yokohama, Japan, one of the world’s largest vegetable and flower
seed companies, confirmed today that it is intending to acquire
a controlling interest in
Zeraim Gedera Ltd., a prominent Israeli vegetable seed
company, through the exercise by certain minority shareholders
of their legal right of first refusal to shares of other
stockholders being offered to a third party.
On August 4, stockholders controlling 61.7% of
Zeraim Gedera entered into an agreement to sell their shares to
Markstone, an
Israeli buy-out firm, at a valuation of $40 million, plus
potential performance-based payments of up to $12 million at the
conclusion of the 2006 fiscal year. Markstone has acknowledged
in writing to the selling stockholders that the agreement to
sell their shares to Markstone is subject to the right of first
refusal of the remaining stockholders to purchase those shares
on the same terms. On September 2, the non-selling shareholders
exercised that right of first refusal with an offer valuing the
company at $52 million, rendering the agreement with Markstone
null and void.
Markstone challenged this legal right of the
minority shareholders in court on September 9 and had its motion
to place an injunction on the sales of shares to the minority
rejected by the court. The parties are now to file briefs to
the court for further jurisprudence. For reasons best known to
itself, Markstone has also attempted to intimidate Sakata and
the minority shareholders into withdrawing the minority offer,
both of which have been unsuccessful.
“Sakata is an
honorable and well respected company in the seed industry and we
have the highest regard for Zeraim Gedera and its people,” said
Pierre Decaillet, President of European Sakata Holding SAS,
“there is almost no overlap in our two businesses and we see
much synergy with our current expertise. We intend to keep
Zeraim Israeli and to support its future growth in world
markets. Markstone would have simply resold the company to the
highest bidder within a few years,” added Mr. Decaillet.
Related news release:
Zeraim Gedera statement on the sale of part
of the Company’s shares |