Danka Proposes Amendment to Separate Shareholder Vote on Proposed Sale of U.S. Subsidiary to Konica Minolta25 Jun, 2008
Danka Proposes Amendment to Separate Shareholder Vote on Proposed Sale of U.S. Subsidiary to Konica Minolta
ST. PETERSBURG, FL (June 18, 2008) - Danka Business Systems PLC has announced it will propose an amendment to the resolution to approve the sale of Danka's U.S. operating subsidiary, Danka Office Imaging Company ("DOIC"), to Konica Minolta Business Solutions U.S.A., Inc. ("Konica Minolta") at the Extraordinary General Meeting scheduled to be held on June 27, 2008. The amendment will enable shareholders to approve the proposed sale regardless of the voting outcome on a separate proposal to conduct a members voluntary liquidation ("MVL") of the parent company.
The change was made in response to recent statements by a number of holders of Danka's American Depositary Shares ("ADSs") that they support the sale of DOIC to Konica Minolta, but do not support the MVL as currently proposed. Danka's Board of Directors determined that it is in the best interests of Danka and its shareholders to no longer condition completion of the sale upon shareholder approval of the MVL.
The Board said that given Danka's liquidity position and existing debt obligations as described in the Company's definitive proxy statement filed with the Securities and Exchange Commission ("SEC") on May 30, 2008, it had concluded that completing the sale of DOIC to Konica Minolta in a timely manner is of paramount importance.
On April 8, 2008, Danka, a leading supplier of office imaging equipment and support services in the United States, announced a definitive agreement to sell DOIC, Danka's sole operating subsidiary, to Konica Minolta, a leading provider of advanced imaging and networking technologies, for approximately $240 million in cash. At that time the Company also announced plans to conduct an MVL, using the sale proceeds to repay all of the Company's outstanding indebtedness, and then distribute the remaining proceeds to Danka shareholders.
"Although we continue to recommend that shareholders vote in favor of the sale transaction, MVL and related proposals, our primary mission is to close the transaction with Konica Minolta as quickly as possible," stated Danka Chairman and Chief Executive Officer A.D. Frazier.
The full text of the proposal to amend the resolution separating approval of the sale transaction from the MVL is set forth in a supplement to the proxy statement filed with the SEC on June 18, 2008 and mailed to holders of ADSs on or about that date. A revised voting instructional form for ADS holders to vote on the proposed amendment, as well as the sale itself, the MVL and related proposals, is enclosed with the supplement.