Omega Protein Signs an Agreement to Acquire 36.8% of its Outstanding Common Stock from Zapata Corporation
Omega has received a commitment letter from Cerberus Capital Management, L.P. for the purpose of financing the purchase of the 9,268,292 shares.
07/11/06 Omega Protein Corporation, the nation’s leading producer of Omega-3 fish oil and specialty fish meal products, announced that it has signed a definitive agreement with its 58% stockholder, Zapata Corporation, to purchase from Zapata 9,268,292 shares of Omega’s common stock at a purchase price of $5.125 per share. The aggregate purchase price for the shares, which represent 36.8% of Omega’s outstanding common stock, will be $47.5 million. At the closing of the transaction, Zapata’s two representatives, Avram A. Glazer and Leonard DiSalvo, will resign from Omega’s Board of Directors.
If Zapata still owns any shares of Omega’s common stock nine months after the closing of the transaction, Omega has the option for a four-month period thereafter to purchase any remaining Omega shares held by Zapata at a purchase price of $4.50 per share.
Omega has received a commitment letter from Cerberus Capital Management, L.P. for the purpose of financing the purchase of the 9,268,292 shares. The commitment provides for a five-year, $35 million term loan and a five-year, $30 million revolving credit facility which will replace Omega’s existing $20 million credit facility with a commercial bank. The closings of the Cerberus financing and the purchase of the shares from Zapata are expected to take place in the fourth quarter of 2006, subject to the completion of the Cerberus financing and the receipt of regulatory approvals, as well as the satisfaction of customary closing conditions.
The transaction has been unanimously approved by a Special Committee of Omega directors who are independent of Zapata. TM Capital Corp. has acted as financial advisor to the Special Committee, and has delivered requested opinions with respect to the transaction to the Special Committee.
Joe von Rosenberg, President and Chief Executive Officer of Omega, commented: “This transaction will allow Zapata to exit its ownership position in an orderly fashion. We believe that the terms of the transaction are highly favorable to our stockholders and we anticipate that the transaction should be accretive to earnings per share in the future.”
