Heelys, Inc. has agreed to be acquired by Sequential Brands Group. Sequential Brands will acquire all of the outstanding shares of common stock of Heelys for $2.25 per share in cash, or approximately $63.2 million.
Heelys also announced that, before entering into the merger agreement
with Sequential, the company's board of directors unanimously determined
that the merger agreement constitutes a "superior proposal" under the
terms and provisions of the company's previously-announced asset
purchase agreement dated Oct. 22, 2012 among The Evergreen Group
Ventures, LLC, the company and its subsidiaries.
terminated the Evergreen Purchase Agreement, and the company has agreed
to pay Evergreen a termination fee, which, pursuant to the Merger
Agreement, will be reimbursed by Sequential.
transaction represents an attractive outcome and is in the best interest
of Heelys stockholders," said Tom Hansen, Heelys President and CEO.
"Their all-cash offer provides our stockholders with a fixed cash value
and eliminates the need to proceed with the previously announced Plan of
Yehuda Shmidman, CEO of Sequential, commented, "We
are excited to be adding the Heelys brand to our portfolio. Heelys is
recognized globally as a pioneer of skate shoes, and with its brand DNA
rooted in innovation and skate, we see the potential for expansion in
the future as a global lifestyle brand." Mr. Shmidman added, "Fitting
with Sequential's brand-management business model, we have identified
our long-term worldwide licensing partner for the core category of
footwear, and will announce the partner and the team managing the Heelys
Tengram Capital Partners advised Sequential on
the transaction. William Sweedler, Managing Partner of Tengram and
Chairman of Sequential, stated, "The Sequential model is simple: find
great brands and marry them with equally great operating licensees to
build on their core DNA. The acquisition of Heelys represents the second
transaction completed by Sequential Brands Group since Tengram's
involvement with the company began earlier this year, and we are excited
about the pipeline of opportunities to add more brands to Sequential's
portfolio in the future."
The proposed merger with Sequential,
which is subject to customary closing conditions, including receipt of
Heelys stockholder approval, is expected to close in the first quarter
of 2013. In connection with the Merger Agreement, Capital Southwest
Venture Corporation and another stockholder of the Company, who
collectively hold approximately 35.1% of the issued and outstanding
shares of the company's common stock, have entered into voting
agreements with Sequential pursuant to which they have agreed, among
other things, to vote their shares in favor of the merger.
company's Special Meeting of Stockholders scheduled for December 13,
2012 to consider and vote upon, among other things, the transactions
contemplated by the Evergreen Purchase Agreement, the change of the
company's name and the dissolution of the company pursuant to a Plan of
Liquidation and Dissolution ("Plan of Dissolution"), has been canceled.
The company's stockholders are instructed to disregard the company's
previously filed proxy statement and related solicitation materials
regarding the Evergreen Purchase Agreement, the name change, and the
dissolution of the company pursuant to the Plan of Dissolution.
information regarding the Sequential Transaction will be included in a
proxy statement the company intends to file with the Securities and
Exchange Commission and distribute to its stockholders. The company's
proxy statement will include information regarding the timing of a
Special Meeting of the company's stockholders to adopt the Merger
Roth Capital Partners, LLC is serving as exclusive
financial advisor to Heelys and has delivered a fairness opinion in
connection with the merger. Gardere Wynne Sewell LLP is serving as legal
advisor to Heelys. Skadden, Arps, Slate, Meagher & Flom LLP is
serving as legal advisor to Sequential.