Here's a link to a message I posted last September after chatting with my company's legal dept about going private. I'm still debating my own strategy but will share it on the board once I've decided. I certainly believe the shares are worth much more than $6.60. If sending something through, you'll want to do it quickly, today if possible or tomorrow at the latest to ensure no decision has already been made by the time they hear from you.http://boards.fool.com/some-good-info-on-shareholder-votes-e...Note that Mr Wu is the Chairman of the Board and CEO and he's partially behind this offer so in this case, the Chairman of the Board is not the appropriate person to petition. You should be sending any letters to the members of the Board's Special Committee who will be making the decision on whether to accept the offer, Mr. Sean Shao, Mr. Xiaochuan Guo and Mr. Xindan Li. Once I figure out the best way to get your letter to them, I'll adviseI'll just copy/paste linked message below:I was speaking to the head of my company's legal dept this afternoon and took advantage of the opportunity to get some info that might be relevant to YONG shareholders, if MS does eventually make an offer to buy out the other shareholders. She had recently been involved in the buyout of a company's minority shareholders so I knew she would be a good source of info.She believes, that regardless of whether the company is incorporated in Delaware or Nevada, there is technically no requirement that there be a "majority of the minority" vote. However, most Board of Directors will usually require that there be a majority of minority vote before accepting any offer as a CYA, as it gives the Board a better defense from shareholder lawsuits. Even with D&O insurance, the BOD will do what they can to avoid or reduce litigation.If YONG gets an offer that you, as a shareholder, feel is below a fair value, she recommended writing a letter to the Chairman of the Board to 1) explain why you believe the offer is too low 2) push that they require a majority of the minority vote before acceptance and 3) request a listing of all shareholders.Now 1) and 2) I had already planned to include in a letter to the Chairman if we end up in this situation. However, I wouldn't have thought of #3. It's an interesting suggestion. The idea is that it puts the Board on notice that shareholders will be fighting the acceptance of any unreasonable offer and that a shareholder may start contacting the other shareholders to recruit others to fight the deal. She thinks this is just the type of thing that would make the BOD nervous about accepting an unreasonably low offer. Ultimately, I think, the threat of shareholder lawsuits (class action, etc) is really the key to this.Now we're not 100% sure that you are really allowed to contact other shareholders if you do receive the shareholder listing, so if it does get that far, make sure you get some formal advice before doing so. But regardless, we would have nothing to lose by requesting the listing from the Board.
Hi mekong,Thanks for the posting. I guess today's announcement come as a 'interesting' surprise and as well as a disappointment. I think everybody can appreciate this mixed feeling.I think the Yong's BOD should definitely put the "majority of the minority" into consideration.but somehow I have a feeling that today's announcement is part of an overall strategy of their acquisition exercise. Given MSPEA is also part of the buyout team, surely they knew that the minority shareholders would have something to say and not to mention the possibility of a class action suit.I do not know how this will play out in the end but surely your suggestion of letter to the board is definitely a very good suggestion.Bby88fool
Mekong22,Thanks for the post! I am very disappointed in the $6.60 price it is way too low. I'd be willing to participate in a class action suit if this goes forward.I'll also write letters if you have e-mail or physical addresses. I've already written investor relations.Ellipsoid
I believe that the best way to contact the special committee is to write them at the company's corporate headquarters, and I will cc a copy to their legal counsel, Cleary Gottlieb, Steen & Hamilton LLP. I'm going to use the address from today's press release where the proposal letter was sentSpecial Committee of The Board of Directors ofYongye International, Inc.6th Floor, Suite 608, Xue Yuan International TowerNo. 1 Zhichun Road, Haidian DistrictBeijing, ChinaCleary Gottlieb, Steen & Hamilton LLPTwin Towers - West (23Fl)12 B Jianguomen Wai Da JieChaoyang DistrictBeijing 100022 I will probably scan a signed copy and also email it to investor relations email@example.com and request that they forward it to the committee members and legal counsel.I've drafted the framework of my letter. I don't want to paste it here as I don't want them to get lots of copies of the same letter from all of us. I start by saying I've been a shareholder since 2009 and state the number of shares I own, make it clear that I believe that the offer is egregiously inadequate. I lay out some numbers to show that a $325m valuation is way too low, then I'll remind them that MS's conversion price was a minimum of $8.80 and the company has outperformed since then. I wrap up by making it clear that if they do accept any offer that I strongly request that they require a majority of the minority vote from shareholders. I'll probably wait until tomorrow to send it out incase I want to take a fresh read in the morning. I think the urgency isn't as intense as I suggested above, but I'd say, if you are going to write to them, to do it this week. There's a good chance I'll be sending a follow up after Q3 is announced next month. I tried not to have more than about a page and a half of text as I don't exactly own a large percentage of the company and suspect that my letter may get less attention if it's too long.
I left off the postcode for Yongye's office above. I believe it is 100083
I am sending off a letter today.Main points:1. Offer price too low and unfair to minority shareholders not participating in proposed buyout2. Long time share holder and intend to hold for long time to come3. Market price and buyout offer severely undervalues company3a. MSPEA is a member of the Buyer Parties and invested several years ago. Conversion price is $8.80 and YONG is surpassing all targets related to this conversion price. Therefore, MSPEA would value the company at AT LEAST $8.80/sh3b. Management believe the market price has and continues to severely undervalue the true value of the Company. Company has for several years through various public releases attempted to get the market price to reflect the true value. Therefore, management, BoD, Buyer Parties, and long term investors like me know the true value is much higher than the buyout offer.4. Buyout would be unfair to minority shareholders not participating in the buyout. Special committee should require a majority of minority shareholders approve the buyout to avoid unfairness and a breach of fiduiary responsibility.
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