Canada's Ritchie to pay special dividend if investors back $7-bln IAA deal (updated)

RB Global

07/03/2023 14:56

(Adds details from Egan-Jones statement, background and shares)
       March 7 (Reuters) - Canada's Ritchie Bros Auctioneers
 RBA.TO  said on Tuesday it would pay a special dividend of
$1.08 per share to its investors if they back its $7-billion
deal for U.S. auto retailer IAA Inc  IAA.N .
    Shareholders of both the companies are set to vote on March
14 on the deal that will allow Ritchie to tap into a growing
market for heavy machinery and equipment, salvaged cars, trucks
and motorcycles.
    IAA shares rose 1% in the early trade. 
        However, Ritchie's shareholders including Luxor Capital
Group, Eminence Capital, Deep Field Asset Management and Janus
Henderson Investors have opposed the deal. 
    The latest move by Ritchie comes after proxy advisory firms
Institutional Shareholder Services and Glass Lewis recommended
that shareholders reject the deal, citing potential risks.
 urn:newsml:reuters.com:*:nL1N35E0XD
    However, another proxy firm, Egan-Jones Proxy Services, on
Monday recommended to vote for the deal. 
        Large investors Eagle Asset Management and Independent
Franchise Partners, which own 2.92% and 4.75% respectively of
Ritchie Bros, have also supported the combination. 
  
    The dividend will be paid subject to receipt of required
shareholder approvals of the merger, Ritchie said adding that
IAA shareholders will not be entitled to receive it.  
    The deal is expected to close on March 20. 


    

 (Reporting by Aishwarya Nair in Bengaluru; Editing by Arun
Koyyur and Anil D'Silva)
 ((Aishwarya.Nair@thomsonreuters.com; +91-9167838937 Twitter: https://twitter.com/Aishwaryartrs
 ;))