Chatham Asset Management Raises Offer to Acquire RR Donnelley to $ 10.85 Per Share in Cash | Business

CHATHAM, NJ – (BUSINESS WIRE) – December 9, 2021–

Chatham Asset Management, LLC (“Chatham”), a private investment company which manages funds which effectively own approximately 14.9% of the outstanding common shares of RR Donnelley & Sons Company (“RRD” or the “Company”) (NYSE: RRD), which is the Company’s largest bondholder, responded to a press release issued today by RRD regarding its acceptance of a revised proposal from affiliates of Atlas Holdings LLC (” Atlas ”) to acquire the Company for $ 10.35 per share in cash.

In a letter sent to RRD’s board of directors (the “Board”), Chatham submitted a binding and fully funded offer to acquire all of the common shares of the company not already held by Chatham for $ 10.85 per cash action. Chatham’s enhanced offer will expire at 11:59 p.m. ET on December 13, 2021, unless it receives a countersigned merger agreement from the company.

Chatham said: “The RRD board has once again evaded its fiduciary obligations and deprived shareholders of receiving a higher price for their shares by refusing to engage in any meaningful way with Chatham and by agreeing to a lower transaction with higher termination fees and reimbursement of expenses that are fully avoidable. We urge the board to act in the best interests of its stakeholders, declare our increased bid superior, and move expeditiously to finalize our proposed transaction.

The full text of the letter follows:

December 9, 2021

Board of directors

Company RR Donnelley & Fils

35 Wacker Drive West

Chicago, Illinois 60601

Ladies and gentlemen:

Chatham Asset Management, LLC (together with its affiliates, “we”, “we” or “Chatham”), the Company’s largest shareholder and borrower, writes in response to press release issued by RR Donnelley & Sons Company ( “RRD” or the “Company”) The Company intends to complete its previously announced transaction with affiliates of Atlas Holdings LLC (“Atlas”), following the increase in the Atlas offer at $ 10.35 per share.

Although the Company issued a press release on December 1, 2021 stating that its trading period with Atlas would expire on December 7, 2021, the Company’s Board of Directors (the “Board”) continued these negotiations for two business days. and has refused to engage in any meaningful way with us, or approach us to counter any further offers, since the declaration of Chatham’s proposal to purchase all of the RRD shares that are not currently held by Chatham at a price equal to $ 10.25 per share, a “superior proposition” under the terms of the Atlas Merger Agreement. In fact, rather than engaging with us during that time, the board just agreed to write Atlas an even bigger check if the company signs an agreement with us, increasing the termination fees and reimbursement of expenses payable to Atlas from $ 20 million to $ 32 million, thus depriving shareholders of approximately $ 0.39 per share, which could have been completely avoided if the board of directors had committed with us in October when we made our initial offer to acquire the company.

The determination of the board of directors to avoid signing an agreement with Chatham at all costs violates any measure of good corporate governance and the fiduciary obligations of directors, and has a deleterious effect on all stakeholders of RRD. This behavior must stop. The Board’s behavior creates confusion in the market and for all RRD stakeholders, causing a significant delay in completing a transaction and threatening to deprive shareholders of receiving the maximum price for their shares. This is not how a public company should conduct an orderly sales process.

Nonetheless, Chatham is prepared to outperform Atlas’s offer and hereby increases its offer to purchase all of the common shares of RRD not already held by Chatham at a price equal to $ 10.85 per share. Our offer remains a firm offer fully financed and entirely in cash.

Our revised offer continues to be supported by a debt commitment letter led by Jefferies Finance LLC totaling up to $ 1.675 billion, a capital commitment letter from Chatham in the amount of up to $ 400 million. dollars, a rollover of all RRD common shares beneficially owned by Chatham, valued at approximately $ 118.6 million based on our proposed purchase price of $ 10.85 per share, and share ownership and / or subordination in PIK instruments up to $ 795.3 million of the total principal amount of outstanding notes of RRD which Chatham currently holds – representing approximately 57.3% of the outstanding notes of RRD. DRIP, including more than 50% of the Company’s 6.125% Senior Secured Notes due November 2026. Assuming that all of the Company’s $ 795.3 million outstanding notes are capitalized or subordinated by Chatham , L a Company reduce its annual interest expense by approximately $ 60.9 million.

All other proposed terms set out in the Merger Agreement and related documents delivered to the Company together with this letter, remain applicable to this offer.

While we understand that the board is contractually obligated to give Atlas two business days to respond to our latest offer, we urge the board to limit this time and engage with us before posting any new mid-market announcements. This offer will expire at 11:59 p.m. ET on December 13, 2021 unless we receive a countersignature to our merger agreement.


/ s / Anthony Melchiorre

Antoine Melchiorre

Managing member

View source version on

CONTACT: Jonathan Gasthalter / Sam Fisher

Gasthalter & Cie.

(212) 257-4170



SOURCE: Chatham Asset Management, LLC

Copyright Business Wire 2021.

PUB: 12/09/2021 16:56 / DISC: 12/09/2021 16:56

Copyright Business Wire 2021.

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