The Annual General Meeting of PMJ Automec, which manufactures production automation systems for the electronics industry rejected March 12th 2000 the merger plan with JOT Automation Group. The proposal put forward by the Board of Directors in February was turned down with clear numbers. Almost 98 per cent of the votes given in the General Meeting were against the merger.
One of the main reasons for the rejection was a profit warning issued by JOT Automation Group last week. In the profit warning the company states that investments will burden profitability in the short-term, especially in the first quarter of 2000. Right after the warning the company’s stock fell precipitously in the market.
The PMJ President and principal shareholder, Markku Jokela, pointed out that he was not the one to knock the merger down. Since PMJ at the time of preparing the merger was primarily looking the previous year’s figures of JOT, the profit warning was a complete shock to PMJ and the General Meeting was not willing to accept the merger, said Jokela.
According to JOT President, Jorma Terentjeff, the cancellation was "a total surprise" to JOT Automation and there are not going to be further negotiations between the companies in this matter. It is very exceptional that the main negotiator in a merger process votes finally against it, said Terentjeff referring to PMJ’s President Jokela.
Both companies stated that the withdrawal of the merger will not affect negatively their business operations in the future.
For further information, please contact Pekka Lehtinen.
This article contains general information on the subject matter and shall not be relied upon for a specific case. Specialist advice should be sought with respect to any specific circumstances.
