Cossette calls Cosmos offer inadequate, Cosmos moves ahead
Cosmos Group of Montreal has entered into a lock-up agreement with Beutel, Goodman & Company by which Beutel Goodman will tender its shares in Cossette to Cosmos at a price of $4.95 per share. Beutel Goodman's stake in Cossette represents 7.6% of the agency's outstanding shares. Along with its own holdings and its previous lock-up agreement with Burgundy Asset Management, this agreement give Cosmos representation over approximately 37.3% of Cossette's outstanding shares.
On Friday Cossette released a statement from its board of directors calling the Cosmos bid "highly opportunistic, highly conditional" and "financially inadequate." Cossette has instructed its financial advisor, BMO Capital Markets, to solicit proposals from third parties interested in acquiring the company. The statement also reminded Cossette shareholders that no offer has yet been made. The statement urged shareholders to take no action at this time. "Pierre Delagrave, president of Cossette Media and Fjord Interactive Marketing and Technology, and myself, both founding partners of the company, are fully aligned with the special committee's and the board's decision to solicit proposals to acquire the company to maximize value for all shareholders," said Claude Lessard, president and CEO of Cossette. "We will cooperate with the board and the special committee to successfully implement a board supported transaction. We are confident that this exercise will be accomplished with the highest regard for Cossette's traditional values and in harmony with the best interests of our two key assets, our employees and clients."