AvenEx Energy Corp AVNDF

95% Chance Merger will be Approved

[trismigistus]

Is Acquiring-Firm Shareholder Approval in Stock-for-Stock Mergers Perfunctory?

Timothy R. Burch
University of Miami - Department of Finance

Angela Morgan
Clemson University - Department of Finance

Jack G. Wolf
Clemson University - Department of Finance

May 2004

Abstract:     
Despite mixed stock returns for acquirer shareholders in large stock-for-stock mergers, acquiring-firm merger proxy votes rarely fail, and in our sample the average approval out of votes cast exceeds 95%. We seek to determine whether such votes are effective in monitoring management's acquisition policy or are merely perfunctory. We find that the margin of approval varies substantially with firm and deal characteristics. Furthermore, while our sample does not contain failed votes, some deals are only narrowly approved. These findings support the notion that merger proxy votes provide credible threats.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=552763

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An analyst who asked not to be identified said PACE stock is so widely held that it will be difficult to put together enough opposition to defeat the merger, which must be supported by two-thirds of the shares that take part in the vote to be carried. He added shareholders aren’t exactly thrilled about the deal but most see no better options for Pace. https://www.calgaryherald.com/business/Pace