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For $0.72 Per Share In Cash Charlotte, N.C., Nov. 11, 2014 / PRNewswire Horizon Lines, Inc. (OTCQB: HRZL) ("Horizon") today announced it has entered into definitive agreements with each of Matson Inc. (NYSE: MATX) ("Matson") and The Pasha Group ("Pasha"). Under the Matson agreement, Matson will acquire all outstanding shares of Horizon Lines for $0.72 per share in an all-cash transaction. The acquisition price represents a premium of approximately 89% over Horizon's closing stock price on November 10, 2014. The Matson agreement has been unanimously approved by Horizon's Board of Directors and Horizon shareholders representing 55% of the fully diluted equity, which also represents 41% of the outstanding voting common stock on November 11, 2014, have agreed to vote their shares in support of the transaction. Under the Pasha agreement, Pasha will acquire Horizon Lines' Hawaii trade lane business, prior to closing of the Matson agreement, for approximately $141.5 million in cash. The proceeds from the Pasha transaction will reduce Horizon Lines' debt obligations prior to closing of the Matson transaction, at which time Matson will acquire all of the outstanding shares of Horizon Lines and repay the remaining debt outstanding at closing. The Pasha agreement has been unanimously approved by Horizon's Board of Directors. As a result of the transactions, Matson, Inc. will acquire all of Horizon Lines' business operations, except for the Hawaii trade lane business. The two transactions taken together are valued at approximately $598 million on an enterprise value basis. Matson will fund its transaction from available borrowings under its bank credit facilities and existing cash on hand. Pasha will fund its transaction from a committed debt financing agreement. There are no financing conditions to either transaction. David N. Weinstein, Chairman of the Board of Directors of Horizon Lines, Inc., said, "These transactions will place our company in the hands of strong stewards with reputations for outstanding customer service. Matson has over 130 years of shipping experience and is guided by a rich history of integrity and innovation. Pasha is a third generation, family-owned business with a proud heritage of excellence and deep ties to the Hawaiian community. Both Matson and Pasha are well-positioned to serve our valued customers." Steve Rubin, President and Chief Executive Officer of Horizon Lines, Inc., said, "Our Board and management team have been working diligently to improve Horizon Lines' financial and operational performance while continuing to provide superior service across all our trade lanes. These transactions are a direct reflection of those efforts, and will enable the proud heritage of Horizon Lines to be passed on to Matson and Pasha." Timing, Conditions and Approvals Horizon Lines, Inc. expects to complete the transactions in 2015, based upon the timing of required approvals and other closing conditions. The transactions are subject to regulatory approvals, including any required notifications pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and other customary closing conditions. The transaction with Matson, Inc. is conditioned upon the closing of the Pasha transaction. Additionally the Pasha transaction is conditioned upon the Matson transaction being ready to close immediately thereafter. Advisors Goldman, Sachs & Co. is serving as financial advisor to Horizon Lines, Inc. and Kirkland & Ellis LLP is serving as legal advisor. Other News In a separate announcement today, Horizon Lines, Inc. announced that it will cease operations and shut down its Puerto Rico domestic liner service. Horizon Lines' decision to terminate its Puerto Rico service is independent of the Pasha Group and Matson, Inc. transactions, and the Company intends to cease operations between the U.S. and Puerto Rico whether or not the transactions with The Pasha Group and Matson, Inc. are consummated. Participants in the Solicitation This report is neither a solicitation of proxy, an offer to purchase nor a solicitation of an offer to sell shares of the Company. The Company and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the Company's stockholders with respect to the Merger. Information about the Company's directors and executive officers and their ownership of Company Common Stock is set forth in the proxy statement on Schedule 14A filed with the SEC on April 15, 2014, the Annual Report on Form 10-K for the fiscal year ended December 22, 2013. Additional information regarding the identity of the potential participants, and their direct or indirect interests in the Merger, by security holdings or otherwise, will be set forth in the proxy statement and other materials to be filed with SEC in connection with the Merger. About Horizon Lines Horizon Lines, Inc. is one of the nation's leading domestic ocean shipping companies and the only ocean cargo carrier serving all three noncontiguous domestic markets of Alaska, Hawaii and Puerto Rico from the continental United States. The company owns a fleet of 13 fully Jones Act qualified vessels and operates five port terminals in Alaska, Hawaii and Puerto Rico. A trusted partner for many of the nation's leading retailers, manufacturers and U.S. government agencies, Horizon Lines, Inc. provides reliable transportation services that leverage its unique combination of ocean transportation and inland distribution capabilities to deliver goods that are vital to the prosperity of the markets it serves. The company is based in Charlotte, NC, and its stock trades on the over-the-counter market under the symbol HRZL. Horizon Lines Inc. press release |
