Dorel Provides Update on Going-Private Transaction and Confirms Outlook

MONTRÉAL, Dec. 21, 2020 (GLOBE NEWSWIRE) -- Dorel Industries Inc. (TSX: DII.B, DII.A) (“Dorel” or “we”) previously announced a plan of arrangement (the “Arrangement”) in which a buyer group (the “Buyer Group”) led by an affiliate (the “Purchaser”) of funds managed by Cerberus Capital Management, L.P. will acquire all of Dorel’s issued and outstanding shares, other than shares owned by Martin Schwartz, Alan Schwartz, Jeffrey Schwartz, Jeff Segel and certain members of their respective immediate families (collectively, the “Family Shareholders”), at a price of C$14.50 in cash per share (the “Consideration”).

The Consideration to be received by Dorel shareholders, other than the Family Shareholders (the “Public Shareholders”), represents a premium of:

• 233% to Dorel’s share price (C$4.35) on February 20, 2020, the date which preceded a five-day market correction related to the COVID-19 pandemic;
• 32% to the C$11.02 closing price of Dorel’s Class B Subordinate Voting Shares on the Toronto Stock Exchange (“TSX”) on September 4, 2020, the date on which the Buyer Group was granted exclusivity; and
• 19% to the 60-day volume weighted average trading price of Dorel’s Class B Subordinate Voting Shares on the TSX for the period ended October 30, 2020.

The Consideration is all cash, which provides Public Shareholders with certainty and immediate liquidity. By contrast, Dorel has historically experienced limited trading liquidity, which makes it difficult for Public Shareholders to realize meaningful liquidity through the public markets on which Dorel’s shares trade.

As Public Shareholders consider their vote on the Arrangement, Dorel would like to provide further clarification regarding certain elements of the Arrangement and confirm its previously-disclosed outlook.

• The intent to privatize Dorel and the formation of a Special Committee to oversee the privatization process began before the COVID-19 pandemic. While Dorel’s business has benefited from tailwinds related to the COVID-19 pandemic in recent quarters, the environment ahead remains uncertain. The recent share price recovery and improved cash flow profile resulted in materially higher offers to purchase the shares of Dorel than were received at the outset of the privatization process in the spring of 2020 and to a significant premium compared to the trading price of Dorel’s shares prior to the COVID-19 pandemic.

• As we disclosed on November 6, 2020 in our third quarter earnings press release, as we entered the fourth quarter, the visibility on earnings was more difficult and the then-expected second wave of the COVID-19 pandemic was beginning to have a significant impact, particularly in Europe. Since then, the second wave has spread to other markets, where it is also expected to have a significant impact. As we previously reported, the COVID-19 pandemic has adversely affected, and is expected to further adversely affect, global economies, which may have an adverse effect on our business.