Shareholders of Indigo Books & Music (IDG) have voted in favour of the retailer being taken private by Gerald Schwartz, the husband of the company’s chief executive Heather Reisman.
Shareholders have supported an offer of $2.50 per share from Trilogy Retail Holdings and Trilogy Investments L.P., which have a 56% stake in Indigo and are owned by Schwartz.
The stock of Indigo Books is currently trading at $2.49 per share. Trilogy had originally offered $2.25 per share but raised its bid in April of this year.
For Trilogy's offer to be accepted, it required approval by two-thirds of Indigo shareholders. About 95% of shareholders voted in favour of the deal.
The privatization avoids what many analysts saw as a potential bankruptcy filing by Canada’s biggest retail chain of bookstores which has struggled financially for years.
Indigo was hit by a cyberattack that downed its website last year. The company has also reported a string of quarterly losses, fired staff, and saw four of 10 board members resign claiming a loss of confidence in Reisman’s leadership.
Indigo Books said in a statement that it expects the privatization to be completed by the end of May and for its shares to be delisted from the Toronto Stock Exchange.
The stock of Indigo Books has declined 65% over the last five years as the shares sank deep into penny stock territory. Since the company’s initial public offering (IPO) back in 1997, Indigo’s stock has fallen 83%.
