At a special meeting held on Monday, Indigo Books & Music shareholders approved a C$2.50 (US$1.83) per share offer from Trilogy Retail Holdings and Trilogy Investments, which already held a 56% stake in the Canadian retailer. In February, Indigo had received a proposal to privatize the company from Trilogy, which is owned by Indigo's controlling shareholder Gerald Schwartz, who sits on the board of directors and is the spouse of Indigo founder and CEO Heather Reisman. After stepping back as CEO in the fall of 2022, Reisman returned to the position last September following the sudden resignation of Peter Ruis.
At the meeting this week, the resolution was approved by 95.09% of the votes cast by company shareholders, and 82.49% of the votes cast by minority shareholders. Indigo is scheduled to seek a final order from the Ontario Superior Court of Justice approving the transaction tomorrow. In addition to receipt of the final order, the completion of the deal is subject to the satisfaction or waiver of other customary conditions. Assuming the remaining conditions are satisfied, it is expected that the arrangement will be effective on or about May 31.
"We are pleased with the result of today's vote and look forward to continuing our work on Indigo's transformation strategy," said Reisman. "We remain deeply committed to our customers and to all our stakeholders as we work together to inspire reading and enrich the lives of booklovers across the country."
Following completion of the deal, the common shares of Indigo will be delisted from the Toronto Stock Exchange. Trilogy also intends to have Indigo to apply to cease to be a reporting issuer under applicable Canadian securities laws, and to otherwise terminate Indigo's public reporting requirements.
"The privatization allows Indigo to avoid some scrutiny as it works to bring profitability and growth back to Canada's biggest bookstore," CBC News reported, adding that Trilogy "now faces a hefty amount of work. Indigo is still recovering from a cyber attack that downed its website for a lengthy period last year, a series of quarterly losses leading up to a January layoff, and a succession of changes that saw four of 10 board members depart last year with one claiming mistreatment and 'a loss of confidence in board leadership.' "