Vertrue amends merger agreement with Velo, offer price increased to $50 per share

By Lisa Kerner

Charlotte, N.C., July 19 - Vertrue Inc. approved an amended merger agreement with Velo Holdings Inc. and Velo Acquisition Inc. that increases the consideration payable to Vertrue's stockholders to $50.00 per share in cash, from $48.50 per share in cash.

The increased per-share offer is a 24.6% premium over the company's stock price of $40.12 per share on Jan. 23, the day prior to media reports about a possible sale.

Vertrue's board is recommending its shareholders approve the amended deal at a special meeting on July 31. The meeting was originally scheduled for July 12, according to a company news release.

Velo Holdings entered into an agreement with Brencourt Advisors, LLC, owner of some 28.1% of Vertrue's common stock, in which Brencourt agreed to vote all of its shares in favor of the transaction. In addition, Velo granted Brencourt the right to acquire up to $25 million in equity securities of Velo Holdings.

Oak Investment Partners, originally part of the investor group formed to acquire Vertrue, is no longer participating in the merger transaction at the increased $50.00-per-share price.

As previously reported, Vertrue's board recently adopted a stockholder protection rights agreement in an effort to "deter abusive takeover tactics that can be used to deprive Vertrue's stockholders of the full value of their investment in Vertrue."

The agreement will not prevent a takeover of Vertrue at a fair price but could cause substantial dilution to a person or group that acquires 15% or more of the shares of Vertrue's common stock. Stockholders beneficially owning 15% or more of Vertrue's outstanding shares at the time of the rights agreement adoption are grandfathered under the terms of the rights agreement until they acquire any additional shares of Vertrue's common stock.

Vertrue is an internet direct marketing services company located in Norwalk, Conn.

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