The EGM (item 1) is called to approve the reverse merger of the controlling holdings FIMEI (51.82% of Recordati) and Rossini Investimenti (100% of FIMEI) into Recordati. Rossini Investimenti is 100% owned by the Luxembourg-based company Rossini Sàrl, which is in turn controlled by CVC Capital Partners.
Recordati shares and FIMEI shares are the only assets held by FIMEI and Rossini Investimenti, respectively, and the two holding companies have no financial debt. Therefore, the transaction will have no effects on the financial position of Recordati. All Recordati shares held by FIMEI will be transferred to Rossini Sàrl, and the Company's share capital will not change. The transaction will generate one-off tax benefits for €12.9 million and annual tax benefits for €1.3 million to Recordati, in accordance with Italian law incentivizing investments in companies based in Italy (so-called "Allowance for Corporate Equity" benefits).
The proposed reverse merger is exclusively aimed at simplifying Recordati's control chain and it will have no effects on its corporate governance or the rights of minority shareholders. Also considering the tax benefits resulting from the transaction, we recommend to vote FOR.
Recordati-Industria Chimica e Farmaceutica is a pharmaceutical group based in Italy. Co.'s operations are divided into two operating segments: pharmaceuticals (and pharmaceutical chemicals) and orphan drugs. Co.'s products include ZANIPRESS®/ZANEXTRA®/LERCAPREL®/LERCARIL®, an antihypertensive drug; ZANIDIP®/CORIFEO®/LERCADIP® (lercanidipine), an antihypertensive drug discovered and developed in Co.'s research laboratories; UROREC® (silodosin), a new drug indicated for the treatment of benign prostatic hyperplasia; and LIVAZO®/ALIPZA® (pitavastatin), a statin for the treatment of dyslipidemia, among others.
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