Couche-Tard urges investors to vote against Casey’s at AGM

Posted by Josette Dunn on 17th September 2010

Canadian c-store group Couche-Tard has released an open letter to the shareholders of takeover target Casey’s General Stores that urges investors to vote against the US retailer at next week’s AGM.In the letter, the Canadian group asked Casey’s shareholders if they “prefer the status quo” or whether they wanted “directors who are committed to maximising the value of your investment” in the US retailer.

The letter was the latest twist in what has become an increasingly hostile takeover battle. Couche-Tard’s first went public with its interest in Casey’s five months ago but it has seen a series of takeover bids rejected.

Couche-Tard has also grown frustrated at Casey’s decision to open talks with rival bidder 7-Eleven even after the US firm rejected the c-store giant’s takeover bid.

In its letter to Casey’s shareholders today, Couche-Tard said it had spent almost a year attempting to negotiate a transaction with the Casey’s board that would provide shareholders with “immediate cash value” for their investment.

“Over that time, your board has refused to discuss or meet with us about our offer and has gone to extreme lengths to place obstacles designed to impede not just our offer, but also a sale of Casey’s to any party,” Couche-Tard said.

The Canadian group said it wanted to “set the record straight once-and-for-all and clear up the continual misrepresentations made by the Casey’s board”.

Couche-Tard said 7-Eleven had not made a formal offer to acquire Casey’s and had only put forward “a non-binding indication of interest”. The Canadians also said it was willing to consider increasing its own US$38.50-a-share offer if they were “granted access into a fair process” by Casey’s.

Additionally, Couche-Tard claimed that Casey’s board had taken actions contrary to its shareholders’ best interests.

“Over the past five months, the Casey’s board has gone to extreme lengths to put in place a laundry list of impediments to our premium all-cash offer, including denying Couche-Tard the opportunity to participate in a full and fair process, implementing the leveraged recapitalisation plan with an unusual and highly coercive “poison put” feature, conducting expensive and meritless litigation against Couche-Tard, adopting a poison pill and putting in place golden parachute arrangements for executives of Casey’s,” the Couche-Tard letter stated.

The letter was released a week before Casey’s AGM where the retailer’s shareholders will vote on the nominations to the company’s board. Both Casey’s and Couche-Tard have put up nominees for election.

Earlier today, Casey’s received support for its own board nominees from two proxy advisory services, which could deal a blow to Couche-Tard’s hopes for its nominees to win seats on the US firm’s board.

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