) declared the final outcome of the offer made by it to the
stockholders, to swap their CBS Class B shares for shares of
CBS Outdoor Americas Inc.
) held by CBS.
Per the previously announced exchange offer, which ended on Jul 9,
for each CBS Class B share accepted in the deal, 2.1689 shares of
CBS Outdoor stock will be swapped.
Prior to the termination, approximately 304.1 million CBS Class B
shares were tendered, as stated by the exchange agent Wells Fargo
Bank, N.A. However, of these 304.1 million shares, CBS accepted
nearly 44.7 million of the tendered stock in exchange of 97 million
CBS Outdoor shares held by CBS.
Owing to the oversubscription of the exchange deal, the company
accepted tendered Class B shares on a pro rata basis, proportional
to the shares validly tendered and not withdrawn validly.
According to the final terms, stockholders who validly tendered all
their shares and owned less than 100 CBS Class B shares, did not
fall under the proration category, as all their shares were
accepted by the company. On the other hand, for all the other CBS
Class B shares, which were validly tendered but not validly
withdrawn, the final 14.7740% pro rata factor was applicable.
CBS had recently announced plans to divest its entire 81% stake in
the spun-off billboard business CBS Outdoors through an exchange
offer. This was a move made by the company to inch closer to its
plans of converting its subsidiary CBS Outdoor into a Real Estate
Investment Trust (REIT).
Conversion into an REIT is important from the taxation viewpoint as
REITs enjoy tax benefits, given the norm of paying 90% of its
income as dividends to shareholders. As per CBS Outdoors., the
conversion will help maximize shareholder wealth.
For CBS, which competes with
Lions Gate Entertainment Corp.
The Walt Disney Company
), the split will allow more focus on its primary operations i.e.
developing, producing and distributing finest quality content
across all platforms on a worldwide basis.
CBS currently carries a Zacks Rank #3 (Hold).
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