Buyer consortium says Hollysys board engaged over the weekend

A buyer consortium led by Dazheng Group Acquisition provided an update to Hollysys shareholders regarding recent negotiations between the consortium and the Special Committee of the board of Hollysys Automation Technologies (HOLI). The Special Committee of the board engaged with the consortium over the weekend, “only after adverse recommendations from both ISS and Glass Lewis regarding the proposed Ascendent Capital transaction,” the consortium said in a statement. The Special Committee has informed the consortium of its intention to enter negotiations with the consortium at 1:29 AM HKT on January 28, to move forward to a potential agreed deal by January 29 HKT, regarding the consortium’s then all-cash offer of $29.00 per share, or approximately $1.8B, to acquire all outstanding shares of Hollysys. “These discussions, spanning less than 40 hours, primarily involved the Consortium providing documentation to and addressing ad hoc requests from the Special Committee and its advisors.” The consortium suspects that thee discussions with the Special Committee and its advisors ” were merely perfunctory. This engagement, coinciding with leading proxy advisors ISS and Glass Lewis advising Hollysys shareholders to vote against the Ascendent transaction, appears to be more of a superficial gesture rather than a sincere attempt at meaningful dialogue,” they said. “Engaging in good faith,” the consortium proposed an increased bid, raising the purchase price from $29.00 to $29.50. “Regrettably, these efforts proved futile, prompting the Consortium to pursue remedies against what it perceives as a problematic and ill-intentioned sales process.” The consortium urges Hollysys shareholders to consider the findings of ISS and Glass Lewis and to “be wary of any claims suggesting that the Special Committee and its advisors has acted transparently or in the best interest of maximizing shareholder value.”