MONTREAL (Business Wire) -- IBEX Technologies Inc. (TSX:IBT) announces that the Board of Directors has, upon the recommendation of its Special Committee, unanimously resolved to recommend to IBEX shareholders that they reject the unsolicited offer by IMI International Medical Innovations Inc. (the "IMI Offer") made on November 4, 2004 and not tender their IBEX shares.
IBEX's Directors' Circular, which contains the recommendation that IBEX shareholders reject the IMI Offer and the extensive reasons for the recommendation, will be mailed to IBEX shareholders at the latest on November 19, 2004. The Directors' Circular will also be available on SEDAR (www.sedar.com).
Orion Securities Inc. has provided the Special Committee of the Board of Directors of IBEX with an opinion that the consideration provided by the unsolicited IMI Offer is inadequate from a financial point of view to IBEX shareholders.
Among the reasons for the recommendation of the Board of Directors
are the following:
- the IMI Offer is financially inadequate;
- the IMI Offer undervalues IBEX and is in an amount ($9 million)
which is less than IBEX's cash, cash equivalents and marketable
securities ($10.5 million);
- the IMI Offer does not give value to IBEX's technology and
business;
- the cash component of the IMI Offer is capped at $2.2 million,
representing only 21% of IBEX's cash, cash equivalents and
marketable securities of $10.5 million;
- the IMI Offer is highly opportunistic in its timing;
- there are prospects for a superior proposal;
- IMI's share trading dynamics are unlikely to provide greater value
for IBEX shareholders in that:
- IMI's stock is thinly traded; and
- the market has not reacted positively to the IMI Offer;
- IBEX shareholders owning a small number of IBEX shares will receive
an "odd lot" of IMI shares; and
- unfavourable income tax consequences may result for IBEX
shareholders resident in the United States.
The Board of Directors is pursuing, with IBEX's financial and legal advisors, alternatives to the IMI Offer in order to maximize value for IBEX shareholders. IBEX has been contacted by and made contact with a number of parties who have expressed an interest in pursuing alternative transactions. IBEX has entered into confidentiality and standstill agreements with interested parties and discussions are underway in order to bring forward additional value-maximizing alternative offers. Certain of such interested parties are examining confidential financial, operating and other relevant information in data rooms set up for such purpose. The Board of Directors believes there is a reasonable prospect that one of these initiatives may result in a competing bid which is financially superior to the IMI Offer.
IBEX also announces that its Board of Directors has adopted a limited duration shareholder rights plan (the "Rights Plan"). The purpose of the Rights Plan is to provide IBEX shareholders and the Board of Directors with adequate time to consider and evaluate the IMI Offer; provide the Board of Directors with adequate time to identify, develop and negotiate value-enhancing alternatives; and encourage the fair treatment of IBEX shareholders in connection with the IMI Offer and any other take-over bid made for IBEX shares. It will also prevent any person from acquiring beneficial ownership of or the right to vote more than 20% of the outstanding common shares while the Board of Directors' process is ongoing, or from entering into arrangements or relationships that have a similar effect. The Rights Plan will be in effect until the earlier of the date of the next annual meeting of IBEX shareholders (scheduled for January 27, 2005) or February 28, 2005, at which time it will expire automatically.
Rights will be issued and attached to all common shares. A separate rights certificate will not be issued until such time as the rights become exercisable (which is referred to as the "separation time"). The Board of Directors has deferred the separation time that would otherwise have occurred as a consequence of the IMI Offer to a date to be determined by the Special Committee in the future. Following an acquisition of IBEX shares otherwise prohibited by the Rights Plan, each right held by a person other than the acquiring person and its affiliates, associates and joint actors would, upon exercise, entitle the holder to purchase IBEX common shares from IBEX with a total market value equal to twice the exercise price of the rights for an amount in cash equal to the exercise price. The Rights Plan provides for permitted bids which would be open for a minimum period of 45 days from the date the bid is made.
About IBEX Technologies Inc.
IBEX Technologies Inc. is a Montreal-based biopharmaceutical company focused on the development and commercialization of proprietary molecular biomarkers and therapeutics for the improved management of cancer and arthritis. For more information, please visit IBEX's Web site at www.ibex.ca.
Email: info@ibex.ca
IBEX Technologies Inc. (TSX:IBT)
IBEX Technologies Inc.
Robert DeLuccia
Chairman of the Special Committee
(514) 344-4004, ext. 111
OR
IBEX Technologies Inc.
Paul Baehr
Chairman, President and Chief Executive Officer
(514) 344-4004, ext. 147
