MDC Partners said Wednesday that it is postponing the special meeting of shareholders scheduled for June 22 to vote on the proposed merger with Stagwell Media.
The delay will provide more time for the MDC board’s committee evaluating the merger to consider revised terms by Stagwell in the face of mounting opposition to the original proposal by some shareholders.
Stagwell submitted proposed amendments to the deal earlier this week which included boosting MDC shareholders’ ownership in the merged company to 30%.
But the revised offer did not appease at least one major MDC shareholder—Indaba Capital Management—which indicated the new terms were still unacceptable and that it intended to vote against the merger.
In a statement issued by the investment firm, Derek Schrier, its Managing Partner said Stagwell was offering “fire sale terms.”
Schrier added that “we contend that even supportive shareholders want to be fairly compensated beyond the 30% share consideration proposed today. If Stagwell wants to come to the table and have a good faith discussion with us, we would be willing to work towards a mutually-agreeable resolution and consider signing a voting agreement.”
The merger vote will be rescheduled soon, MDC said.
Meanwhile MDC’s regular annual meeting which also been set for June 22 will proceed as scheduled.