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Genesco shareholders approve acquisition by Finish Line despite questionable financing
By Lisa Kerner
Charlotte, N.C., Sept. 17 - Genesco Inc. shareholders voted to approve the company's acquisition by the Finish Line, Inc. at a special meeting on Monday.
Approximately 73% of the Genesco capital stock shares present and voting, or about 72% of the total shares, voted in favor of the deal. The results are preliminary.
The June 18 merger agreement between the two specialty retailers gives Genesco shareholders $54.50 cash per share in a transaction valued at some $1.5 billion.
Genesco's Nashville operations will be maintained, and the company will become a subsidiary of Indianapolis-based Finish Line.
The special meeting was adjourned due to the lack of a quorum with respect to a proposal to approve and adopt a charter amendment that would permit the redemption of Genesco's employees' subordinated convertible preferred stock after the merger, a Genesco statement said. The charter amendment is not a condition to the merger. A vote will be taken once the meeting is reconvened.
On Sept. 14, the Finish Line said its financing for the merger was in jeopardy due to the concerns of UBS Loan Finance LLC and UBS Securities LLC that Genesco's financial position was deteriorating.
It was previously reported that UBS asked the Finish Line to have Genesco supply proof that it had not experienced a material adverse effect.
Genesco reported a loss before discontinued operations of $2.9 million, or $0.13 per diluted share, for the second quarter ended Aug. 4. For the same period last year, the company reported earnings before discontinued operations of $5.9 million, or $0.24 per diluted share.
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