Dril-Quip and Innovex Announce Withdrawal of Charter Amendment Proposal
Dril-Quip (NYSE:DRQ) and Innovex Downhole Solutions have withdrawn the charter amendment proposal for their proposed merger, eliminating the requirement for stockholder approval of certain post-closing governance matters. This decision comes after feedback from investors who expressed concerns about some governance provisions. The companies have waived the condition for the charter amendment approval, and Dril-Quip stockholders will no longer vote on Proposals 2 and 3 at the September 5, 2024 special meeting. The merger remains on track, with Dril-Quip's Board unanimously recommending stockholders vote 'FOR' the remaining proposals. This move demonstrates responsiveness to shareholder input and commitment to strong corporate governance practices.
Dril-Quip (NYSE:DRQ) e Innovex Downhole Solutions hanno ritirato la proposta di modifica dello statuto per la loro fusione proposta, eliminando la necessità di approvazione da parte degli azionisti su alcune questioni di governance post-fusione. Questa decisione è avvenuta dopo il feedback degli investitori che hanno espresso preoccupazioni riguardo a determinate disposizioni di governance. Le aziende hanno rinunciato alla condizione per l'approvazione della modifica dello statuto, e gli azionisti di Dril-Quip non voteranno più sulle Proposte 2 e 3 durante la riunione speciale del 5 settembre 2024. La fusione rimane nei tempi previsti, con il Consiglio di Dril-Quip che raccomanda all'unanimità agli azionisti di votare 'A FAVORE' delle proposte residue. Questa mossa dimostra reattività alle opinioni degli azionisti e impegno verso solide pratiche di governance aziendale.
Dril-Quip (NYSE:DRQ) e Innovex Downhole Solutions han retirado la propuesta de enmienda del estatuto para su fusión propuesta, eliminando el requisito de aprobación de los accionistas sobre ciertos asuntos de gobernanza posteriores al cierre. Esta decisión se tomó tras el feedback de los inversores que expresaron preocupaciones sobre algunas disposiciones de gobernanza. Las compañías han renunciado a la condición para la aprobación de la enmienda del estatuto, y los accionistas de Dril-Quip ya no votarán sobre las Propuestas 2 y 3 en la reunión especial del 5 de septiembre de 2024. La fusión sigue su curso, con la Junta de Dril-Quip recomendando unánimemente a los accionistas votar 'A FAVOR' de las propuestas restantes. Este movimiento demuestra una respuesta a las opiniones de los accionistas y un compromiso con sólidas prácticas de gobernanza corporativa.
Dril-Quip (NYSE:DRQ)와 Innovex Downhole Solutions는 정관 개정 제안을 철회했습니다, 이는 제안된 합병에 대한 주주 승인의 필요성을 없애줍니다. 이 결정은 투자자들로부터의 피드백 이후 이루어졌으며, 그들은 일부 거버넌스 조항에 대해 우려를 표명했습니다. 두 회사는 정관 개정 승인 조건을 면제했습니다, 따라서 Dril-Quip의 주주들은 2024년 9월 5일 특별 회의에서 더 이상 제안 2와 3에 대해 투표하지 않습니다. 합병은 순조롭게 진행 중이며, Dril-Quip의 이사회는 주주들에게 나머지 제안들에 대해 '찬성' 투표를 할 것을 전면적으로 권장합니다. 이 조치는 주주의 의견에 대한 반응성과 강력한 기업 거버넌스 관행에 대한 헌신을 보여줍니다.
Dril-Quip (NYSE:DRQ) et Innovex Downhole Solutions ont retiré la proposition de modification des statuts pour leur fusion proposée, éliminant ainsi l'exigence d'approbation par les actionnaires sur certaines questions de gouvernance post-clôture. Cette décision survient après les retours des investisseurs qui ont exprimé des préoccupations concernant certaines dispositions de gouvernance. Les entreprises ont renoncé à la condition d'approbation de la modification des statuts, et les actionnaires de Dril-Quip ne voteront plus sur les Propositions 2 et 3 lors de la réunion spéciale du 5 septembre 2024. La fusion demeure sur la bonne voie, le Conseil d'administration de Dril-Quip recommandant à l'unanimité aux actionnaires de voter 'POUR' les propositions restantes. Ce mouvement démontre une réponse aux avis des actionnaires et un engagement en faveur de pratiques de gouvernance d'entreprise solides.
Dril-Quip (NYSE:DRQ) und Innovex Downhole Solutions haben die Änderung des Statutsvorschlags zurückgezogen für ihre vorgeschlagene Fusion, wodurch die Notwendigkeit der Zustimmung der Aktionäre zu bestimmten Fragen der Unternehmensführung nach dem Abschluss entfällt. Diese Entscheidung folgt auf Rückmeldungen von Investoren, die Bedenken hinsichtlich einiger Governance-Bestimmungen geäußert haben. Die Unternehmen haben die Bedingung für die Genehmigung der Statutsänderung fallen gelassen, und die Aktionäre von Dril-Quip werden nicht mehr über die Vorschläge 2 und 3 bei der Sonderversammlung am 5. September 2024 abstimmen. Die Fusion bleibt auf Kurs, wobei der Vorstand von Dril-Quip einstimmig empfiehlt, dass die Aktionäre 'JA' zu den verbleibenden Vorschlägen stimmen. Dieser Schritt zeigt die Reaktionsfähigkeit auf die Meinungen der Aktionäre und das Engagement für starke Corporate-Governance-Praktiken.
- Merger with Innovex Downhole Solutions remains on track
- Responsiveness to shareholder feedback demonstrates strong corporate governance
- Withdrawal of charter amendment proposal due to investor concerns about governance provisions
Insights
The withdrawal of the charter amendment proposal represents a significant shift in the merger dynamics between Dril-Quip and Innovex. This move demonstrates responsiveness to shareholder concerns and a commitment to maintaining strong corporate governance practices. By removing the governance provisions that were causing investor unease, the companies are prioritizing shareholder satisfaction and potentially smoothing the path for merger approval.
However, this change also raises questions about the post-merger governance structure. The original charter amendment likely included provisions designed to protect shareholder interests or balance control between the merging entities. Its removal could alter the power dynamics within the combined company. Investors should closely examine how this might impact long-term corporate decision-making and shareholder rights.
Overall, while this decision may facilitate the merger's completion, it's important for shareholders to understand the implications of these governance changes on their future influence and the company's strategic direction.
The waiver of the charter amendment condition is a strategic move to expedite the merger process. By eliminating potential roadblocks, Dril-Quip and Innovex are demonstrating their commitment to completing the deal. This flexibility could be viewed positively by the market, as it shows the companies' willingness to adapt to shareholder feedback.
However, investors should note that the original governance provisions were likely negotiated as part of the merger agreement for specific reasons. Their removal might alter the balance of power or protections in the combined entity. It's important to assess how this change might affect the merger's overall value proposition and potential synergies.
The market's reaction will be telling - if investors view this as a positive step towards deal completion, it could support the stock price. Conversely, concerns about altered governance structures could lead to increased scrutiny of the merger's terms and potential long-term implications.
In addition, Dril-Quip and Innovex have agreed to withdraw the submission of the charter amendment proposal (Proposal No. 2) and the related non-binding governance proposals (Proposal Nos. 3A – F) to Dril-Quip stockholders at the special meeting of Dril-Quip’s stockholders to be held on September 5, 2024. These actions eliminate the requirement that stockholders approve the charter amendment, which provided for certain post-closing governance related matters, as a condition to the closing of the merger.
Accordingly, Dril-Quip's stockholders will no longer be asked to vote to approve Proposals 2 and 3, relating to the charter amendment, as set forth in Dril-Quip’s proxy statement/prospectus dated August 6, 2024 in connection with the upcoming stockholder meeting to be held on September 5, 2024.
John V. Lovoi, Dril-Quip’s Chairman of the Board, said: “We have engaged in extensive discussions with our stockholders over the past several weeks. Based on feedback from our investors, we have heard a clear recognition of the strategic rationale and anticipated benefits of our proposed merger with Innovex. However, certain of our stockholders have also expressed concerns regarding some of the governance provisions included in the charter amendment proposal. In response to this feedback, we have worked closely with Innovex and its controlling stockholder to remove these governance provisions in order to address these concerns. This decision reflects our responsiveness to shareholder input and commitment to strong corporate governance practices. We remain confident that this merger will create significant value for all stakeholders, and we look forward to continuing to work towards a successful close.”
The proposed merger remains on track, and Dril-Quip and Innovex are committed to completing the merger.
The Dril-Quip Board unanimously recommends that Dril-Quip stockholders vote “FOR” each of the remaining proposals to be considered at the special meeting, which will be held on Thursday, September 5, 2024, at 9:30 a.m. Central Time. Dril-Quip stockholders who have any questions concerning the merger or the proxy statement/prospectus or would like additional copies or need help voting their shares of Dril-Quip common stock, please contact Dril-Quip’s proxy solicitor:
Morrow Sodali LLC
333 Ludlow Street, 5th Floor, South Tower
Stockholders may call toll-free: (800) 662-5200
Banks and brokers may call collect: (203) 658-9400
About Dril-Quip
Dril-Quip is a leading developer, manufacturer and provider of highly engineered equipment and services for the global offshore and onshore oil and gas industry.
About Innovex Downhole Solutions, Inc.
Innovex designs, manufactures, and installs mission-critical drilling & deployment, well construction, completion, production, and fishing & intervention solutions to support upstream onshore and offshore activities worldwide.
Cautionary Statement Regarding Forward-Looking Statements
Statements contained herein relating to future operations and financial results or that are otherwise not limited to historical facts are forward-looking statements within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended, including, but not limited to, those related to projections as to the anticipated benefits of the proposed transaction, the impact of the proposed transaction on Dril-Quip’s and Innovex’s businesses and future financial and operating results are based on management’s estimates, assumptions and projections, and are subject to significant uncertainties and other factors, many of which are beyond Dril-Quip’s and Innovex’s control. These factors and risks include, but are not limited to: the impact of actions taken by the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC nations to adjust their production levels, risks related to the proposed transaction, including, the prompt and effective integration of Dril-Quip’s and Innovex’s businesses and the ability to achieve the anticipated synergies and value-creation contemplated by the proposed transaction; the risk associated with Dril-Quip’s ability to obtain the approval of the proposed transaction by its stockholders required to consummate the proposed transaction and the timing of the closing of the proposed transaction, including the risk that the conditions to the transaction are not satisfied on a timely basis or at all and the failure of the transaction to close for any other reason; unanticipated difficulties or expenditures relating to the transaction, the response of business partners and retention as a result of the announcement and pendency of the transaction; and the diversion of management time on transaction related issues, the impact of general economic conditions, including inflation, on economic activity and on Dril-Quip’s and Innovex’s operations, the general volatility of oil and natural gas prices and cyclicality of the oil and gas industry, declines in investor and lender sentiment with respect to, and new capital investments in, the oil and gas industry, project terminations, suspensions or scope adjustments to contracts, uncertainties regarding the effects of new governmental regulations, Dril-Quip’s and Innovex’s international operations, operating risks, the impact of our customers and the global energy sector shifting some of their asset allocation from fossil fuel production to renewable energy resources, and other factors detailed in Dril-Quip’s public filings with the Securities and Exchange Commission (the “SEC”). Investors are cautioned that any such statements are not guarantees of future performance and actual outcomes may vary materially from those indicated.
Important Information for Stockholders
In connection with the proposed merger of Dril-Quip and Innovex, Dril-Quip filed with the SEC a registration statement on Form S-4 (as amended, the “Registration Statement”) on May 1, 2024 that included a proxy statement/prospectus (the “Proxy Statement/Prospectus”). The Registration Statement was declared effective by the SEC on August 6, 2024. Dril-Quip filed the definitive proxy statement/prospectus with the SEC on August 6, 2024, and it was first mailed to Dril-Quip’s stockholders on August 6, 2024. Dril-Quip has filed other relevant documents with the SEC regarding the proposed merger. This document is not a substitute for the Proxy Statement/Prospectus or Registration Statement or any other document that Dril-Quip has filed with the SEC. STOCKHOLDERS ARE URGED TO CAREFULLY READ THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND OTHER RELEVANT DOCUMENTS THAT HAVE BEEN FILED BY DRIL-QUIP WITH THE SEC IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER. Such stockholders can obtain free copies of the Registration Statement and Proxy Statement/Prospectus and other documents containing important information about Dril-Quip, Innovex and the proposed merger through the website maintained by the SEC at http://www.sec.gov. Additional information is available on Dril-Quip’s website, www.dril-quip.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240825948944/en/
Investor Relations:
Erin Fazio, Director of Corporate Finance
erin_fazio@dril-quip.com
Dril-Quip
Media Relations:
Sydney Isaacs / Chuck Dohrenwend
Sydney.Isaacs@h-advisors.global / Chuck.Dohrenwend@h-advisors.global
H/Advisors Abernathy
Source: Dril-Quip, Inc.
FAQ
What changes were made to Dril-Quip's (DRQ) merger proposal with Innovex?
When is Dril-Quip's (DRQ) special stockholder meeting for the Innovex merger?
Why did Dril-Quip (DRQ) withdraw the charter amendment proposal for the Innovex merger?
What is the Dril-Quip (DRQ) Board's recommendation for the remaining merger proposals?
