United States securities and exchange commission logo
July 21, 2022
Amanda Fenster
Partner
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Re: Covetrus, Inc.
Schedule 13E-3
June 30, 2022
File No. 005-90857
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Preliminary Proxy
Statement on Schedule 14A
June 30, 2022
File No. 001-38794
Dear Ms. Fenster:
We have reviewed your filings and have the following comments. In
some of our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments by providing the requested
information or advise us as
soon as possible when you will respond. If you do not believe our
comments apply to your facts
and circumstances, please tell us why in your response.
After reviewing your
response to these comments, we may have additional comments.
Schedule 13E-3
General
1. Revise the proxy
statement to present the information required by Items 7, 8 and 9 of
Schedule 13E-3 at the
forepart of the document in a section entitled "Special Factors."
See Rule
13e-3(e)(1)(ii).
2. Please advise whether
any of the filing persons on the Schedule 13E-3 besides the
Company engaged a
financial advisor in connection with this transaction. In this regard,
we note the disclosure
on page 5 of the proxy statement referencing $34 million in fees
incurred by Parent and
Merger Sub for "legal, financial and other advisory fees." To the
extent that they did
so, please revise to provide the disclosure required by Item 9 of
Amanda Fenster
FirstName LastNameAmanda
Weil, Gotshal & Manges LLP Fenster
Comapany
July NameWeil, Gotshal & Manges LLP
21, 2022
July 21,
Page 2 2022 Page 2
FirstName LastName
Schedule 13E-3, or advise. In addition, file any written materials
received as exhibits to
the Schedule 13E-3.
3. In your response letter, tell us why you have not included TPG Global
and its affiliates as
filers on the Schedule 13E-3. Alternatively, add filers and revise the
proxy statement to
include all of the disclosure required by Schedule 13E-3 for the
newly-added filers.
Preliminary Proxy Statement on Schedule 14A
Cautionary Statement Regarding Forward-Looking Statements, page 22
4. The safe harbor for forward-looking statements in the Private
Securities Litigation Reform
Act of 1995 does not apply to forward-looking statements made in
connection with a
going private transaction such as this one. See Exchange Act Section
21(b)(1)(E). Please
revise this section accordingly.
Background of the Merger, page 34
5. We note the disclosure that the Company retained both Goldman Sachs
and Lincoln
International as its financial advisors in connection with this
transaction. Revise the proxy
statement to summarize all reports, either written or oral, provided
by Lincoln and to file
any written materials as exhibits to the Schedule 13E-3.
6. Item 9 of Schedule 13E-3 and Item 1015(b)(6) of Regulation M-A
requires a filing person
to summarize in considerable detail any reports, whether oral or
written, in the proxy
statement. This section references multiple presentations by Goldman
Sachs to the Board
during the course of entering into this Merger Agreement, and
considering alternatives for
the Company. See for example, references to meetings on September 30,
2021, October
25, 2021, December 3, 2021, and December 9, 2021. For these and any
other meetings
between the Company and its financial advisors, summarize the
substance of the
presentations and file any written materials provided as exhibits to
the Schedule 13E-3.
We note that the only materials currently filed are dated May 2022.
Reasons for the Merger; Recommendation of the Board; Fairness of the Merger,
page 46
7. We note that the Transaction Committee considered the analyses and
conclusion
underlying Goldman Sachs opinion in making its fairness determination.
We note that if
any filing person has based its fairness determination on the analysis
of factors undertaken
by others, such person must expressly adopt this analysis as their own
in order to satisfy
the disclosure obligation under Item 8 of Schedule 13E-3 and
corresponding Item 1014(b)
of Regulation M-A. See Question 20 of Exchange Act Release No.
34-17719 (April 13,
1981). Accordingly, please revise to state, if true, that the
Transaction Committee, on
behalf of Covetrus, Inc, ultimately adopted Goldman Sachs analyses and
conclusion as
their own.
Amanda Fenster
FirstName LastNameAmanda
Weil, Gotshal & Manges LLP Fenster
Comapany
July NameWeil, Gotshal & Manges LLP
21, 2022
July 21,
Page 3 2022 Page 3
FirstName LastName
Position of the CD&R Entities as to the Fairness of the Merger, page 51
8. Refer to the second to last paragraph in this section on page 54 of
the proxy statement.
Remove the qualifier "is believed to" in the first sentence of that
paragraph. The filing
persons are responsible for describing their analysis of the Merger,
including all material
factors they considered in reaching their determination that it is
fair to unaffiliated
shareholders.
Certain Financial Projections Utilized in Connection with the Merger, page 54
9. Summarize the material assumptions and limitations on the financial
forecasts disclosed.
Opinion of Goldman Sachs & Co. LLC, page 57
10. On page 60, explain in greater detail how Goldman selected the
precedent transactions it
analyzed. Provide the same expanded explanation for how it identified
the selected
companies on page 62.
11. The Board Book materials filed as Exhibit 99(c)(2) of Schedule 13E-3
should be
summarized in considerable detail in the proxy statement. See Item
1015(b)(6) of
Regulation M-A and Item 9 of Schedule 13E-3. As one example only of
information
currently omitted, revise to disclose all of the per share valuation
ranges that appear on
page 15 of Exhibit 99(c)(2), including the Wall Street Analyst Price
Targets and the 52-
Week Trading Range per shares values.
Purpose and Reasons of the CD&R Entities for the Merger, page 64
12. Revise this section to discuss why the CD&R Entities are seeking to
purchase all of the
common shares of the Company they do not currently own. The statement
that the
Merger "is to allow Parent to own equity interests in the Company and
to bear the rewards
and risks of such ownership" does not explain why those parties seek
to do so. See Item
1013 of Regulation M-A. Please expand to explain why the CD&R Entities
are seeking to
acquire the Company. Your revised discussion should also address the
reasons for the
timing of the transaction.
General
13. We note the disclosure in the Background of the Merger section
describing interactions
between CD&R and the Company leading up to the parties' entry into the
Merger
Agreement. We note the disclosure that in August 2021, CD&R relayed
its possible
interest in having the Company explore strategic alternatives,
including a purchase of the
Company. This interest was reiterated in November 2021. By April 2022,
the CD&R
representatives (at a meeting of the Transaction Committee)
communicated their
willingness to explore a purchase of the Company at a price range of
$21-$22 per shares.
However, we are unable to locate a Schedule 13D amendment for CD&R
from November
11, 2020 until May 20, 2022 (which amendment disclosed the Merger
proposal). Please
Amanda Fenster
Weil, Gotshal & Manges LLP
July 21, 2022
Page 4
advise, with reference to the disclosure requirements of Schedule 13D
including Item 4 of
that Schedule, why CD&R did not amend its Schedule 13D earlier.
We remind you that the filing persons are responsible for the accuracy
and adequacy of
their disclosures, notwithstanding any review, comments, action or absence of
action by the staff.
Please direct any questions to Michael Killoy at 202-551-7576 or
Christina Chalk at 202-
551-3263.
FirstName LastNameAmanda Fenster Sincerely,
Comapany NameWeil, Gotshal & Manges LLP
Division of
Corporation Finance
July 21, 2022 Page 4 Office of Mergers
& Acquisitions
FirstName LastName