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Exhibit
99.1
[Valassis letterhead] [ADVO letterhead]
VALASSIS AND ADVO TO AMEND MERGER AGREEMENT
AND SETTLE LITIGATION
LIVONIA, Mich., and WINDSOR, Conn. – December 19,
2006 – Valassis (NYSE: VCI ) and ADVO, Inc. (NYSE: AD)
today announced that the companies have amended the terms of their
definitive merger agreement. Under the amended terms, Valassis will
acquire all of the outstanding common shares of ADVO stock for $33
per share in cash, or an aggregate of approximately $1.2 billion
(on a diluted basis), including approximately $125 million in
existing ADVO long-term debt which Valassis expects to refinance.
As part of the agreement, the companies have agreed to dismiss with
prejudice their pending litigation in the Court of Chancery for New
Castle County, Delaware.
Valassis’ obligations under the amended merger agreement
are not conditioned upon obtaining financing, and there are no
conditions to close other than the approval of ADVO stockholders at
a special shareholders meeting. The parties expect to close the
transaction during the first quarter of 2007. In the event that the
closing of the transaction is delayed after February 28, 2006,
for reasons other than to obtain ADVO shareholder approval,
Valassis will pay ADVO stockholders interest on the $33 per share
purchase price at a rate of approximately 11 percent per annum,
with the rate increasing every month thereafter.
Valassis further announced that, as a result of the extensive
discovery proceedings in the litigation, including the continued
review of over one million documents produced by ADVO and the
depositions of over 30 ADVO witnesses, Valassis has determined that
the evidence will not support the conclusion that ADVO or any of
its directors, officers, agents or representatives engaged in any
fraud or other misconduct in connection with the parties' entry
into their original merger agreement.
"We are pleased to have reached this amended agreement with ADVO
and put the litigation behind us," said Alan F. Schultz, Chairman,
President and Chief Executive Officer of Valassis. "As we have
maintained since the execution of the original agreement, we
believe in the strategic value of an ADVO and Valassis combination
and look forward to becoming a more diversified company with the
benefits it will bring."
S. Scott Harding, Chief Executive Officer of ADVO, said, "We are
glad to have reached an agreement with Valassis that allows us to
move forward with a merger that has always made tremendous sense.
We look forward to focusing our energy on creating value through
combining and growing our businesses."
The transaction will create the nation’s largest
integrated media services provider. The combination will feature
the most comprehensive product and customer offering in the
industry serving 20,000 advertisers worldwide, including 94 of the
top 100 advertisers in the United States. The combined company will
be positioned to capture growth across the expanded product and
service portfolio, delivering customized, targeted solutions on a
national, regional, zip code, sub-zip code and household basis.
ADVO’s shared mail distribution business penetrates up to
114 million households, or 90% of U.S. homes, adding
substantially to Valassis’ weekly newspaper distribution of
over 60 million households. The combined company will have
7,900 employees with operations in nine countries.
About Valassis
Valassis offers a wide range of marketing services to consumer
packaged goods manufacturers, retailers, technology companies and
other customers with operations in the United States, Europe,
Mexico and Canada. Valassis' products and services portfolio
includes: newspaper-delivered promotions and advertisements such
as
inserts, sampling, polybags and on-page
advertisements; direct-to-door advertising and sampling; direct
mail; Internet-delivered marketing; loyalty marketing software;
coupon and promotion clearing; and promotion planning and analytic
services. Valassis has been listed as one of FORTUNE
magazine’s "Best Companies to Work For" for nine consecutive
years. Valassis subsidiaries include Valassis Canada, Promotion
Watch, Valassis Relationship Marketing Systems, LLC and NCH
Marketing Services, Inc. For additional information, visit the
company Web site at www.valassis.com.
SAFE HARBOR AND FORWARD LOOKING STATEMENTS
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