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Proposed Cadmus-Provenco merger update

February 27: Announcement - Proposed merger update

The proposed board for the merger of Cadmus Technology Limited (NZX:CTL) and Provenco Group Limited (NZX:PVO) today announced that significant progress has been made since the proposed merger has received Commerce Commission's clearance and the companies were close to finalising documents for shareholder meetings.

A new share ratio for the proposed merger has been agreed by both companies, exchanging 4.2 Cadmus shares for 1 Provenco share.

Independent expert Grant Samuel has indicated, in a draft report provided to both companies, that it considers a ratio of 4.2 to be fair to shareholders.

Their draft report further commented that both Cadmus and Provenco shareholders are, in Grant Samuel's opinion, likely to be better off if the merger is implemented than if it is not.

Rick Christie, chairman of the proposed board, said the new ratio reflected changes in both companies and their operating environments. He believed it represented a fair and equitable deal for shareholders of both companies.

"The merger ratio has been altered to reflect the trading of each company in the four months since the proposed merger was announced. In particular, for Provenco shareholders, it reflects the volatility of the international operating environment of that company's Retail Automation division."

Mr Christie said confirmation of the conversion ratio, its appraisal by an independent third party and approval by the proposed board, following Commerce Commission's clearance for the proposed merger, set out a very clear pathway forward.



"The next steps are to finalise the merger proposal documentation for shareholders of both companies. We expect this to be issued in mid March with shareholder meetings for both companies to discuss the merger proposal in early April."

In the meantime the companies are working to finalise other third party approvals.

"Both companies are committed to making sure that their shareholders' interests are protected, whilst continuing with business as usual," Mr Christie said.

ENDS

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