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EXHIBIT 5
ABN AMRO LETTERHEAD
March 27, 1998
The Board of Directors
Ameriwood Industries International Corporation
168 Louis Campau Promenade, Suite 400
Grand Rapids, MI 49503
Gentlemen:
We understand that Ameriwood Industries International Corporation (the
"Company"), Dorel Industries Inc. (the "Acquiror") and Horizon Acquisition,
Inc., a wholly owned subsidiary of the Acquiror (the "Merger Sub"), propose to
enter into an Agreement and Plan of Merger dated March 27, 1998 (the
"Agreement") which provides for the commencement of a cash tender offer (the
"Offer") by Merger Sub to acquire all of the issued and outstanding shares of
the Company's common stock, par value $1.00 per share (the "Common Stock"), at
$9.625 per share, net to the seller in cash (the "Per Share Amount"), and for
the subsequent merger of Merger Sub with and into the Company, pursuant to which
each outstanding share of Common Stock not purchased in the Offer will be
converted into the right to receive a cash amount equal to $9.625 (the "Cash
Consideration") (the "Merger" and together with the Offer, the "Transaction").
The Per Share Amount and the Cash Consideration to be received by holders of
Common Stock pursuant to the Transaction are collectively referred to herein as
the "Consideration."
You have asked us whether, in our opinion, the Consideration to be received
by the holders of Common Stock is fair to such stockholders from a financial
point of view.
In connection with this opinion, we have reviewed the Agreement and certain
related documents and held discussions with certain senior officers and other
representatives and advisors of the Company concerning the business, operations
and prospects of the Company. We have examined certain publicly available
business and financial information relating to the Company as well as certain
financial data and other data for the Company which were provided to or
otherwise discussed with us by certain senior officers of the Company. We
reviewed the financial terms of the Transaction as set forth in the Agreement in
relation to the current and historical market prices and trading volumes of the
Common Stock, the Company's financial and other operating data, and the
capitalization and financial condition of the Company. We also considered, to
the extent publicly available, the financial terms of certain other business
combinations recently effected which we considered relevant in evaluating the
Transaction and analyzed certain financial, stock market and other publicly
available information relating to the businesses of other companies whose
operations we considered relevant in evaluating those of the Company. In
connection with our engagement we identified, approached and held discussions
with certain third parties to solicit indications of interest in a possible
acquisition of the Company.
In rendering our opinion, we have assumed and relied upon the accuracy and
completeness of the financial and other information reviewed by us and we have
not made or obtained or assumed any responsibility for independent verification
of such information. In addition, we have not made an independent evaluation or
appraisal of the assets and liabilities of the Company or any of its
subsidiaries. With respect to the projected financial data, we have assumed that
it has been reasonably prepared on bases reflecting the best currently available
estimates and judgments of the management and the Company as to the future
financial performance of the Company. We have assumed that the Transaction will
be consummated in accordance with the terms of the Agreement.
ABN AMRO Incorporated ("AAI"), as part of its investment banking business,
is continually engaged in the valuation of businesses in connection with mergers
and acquisitions, as well as public offerings and secondary market transactions
of securities and valuations for other purposes. We have acted as financial
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advisor to the Board of Directors of the Company in connection with this
transaction and will receive a fee for rendering our services, including this
opinion, a significant portion of which is contingent upon the consummation of
the Transaction. In the ordinary course of our business, AAI and its affiliates
may actively trade securities of the Company for their own account and for the
accounts of customers and, accordingly, may at any time hold a long or short
position in such securities.
It is understood that this letter is for the benefit and use of the Board
of Directors of the Company in its consideration of the Transaction and may not
be used for any other purpose or reproduced, disseminated, quoted or referred to
at any time, in any manner or for any purpose without our prior consent, except
that the Company is authorized to include this letter in its entirety in the
Offer documents, the Schedule 14D-9 and, if applicable, the proxy materials
contemplated by the Agreement. This letter does not address the Company's
underlying business decision to enter into the Transaction or constitute a
recommendation to any stockholder as to whether such stockholder should tender
their shares or how such stockholder should vote with respect to the proposed
Transaction. In addition, we express no opinion relative to terms on which
certain stockholders have entered into Tender and Option Agreements. Finally,
our opinion is necessarily based on economic, monetary, market and other
conditions as in effect on, and the information made available to us as of, the
date hereof, and we assume no responsibility to update or revise our opinion
based upon circumstances or events occurring after the date hereof.
Based upon and subject to the foregoing, we are of the opinion that, as of
the date hereof, the Consideration is fair from a financial point of view to the
stockholders of the Company.
Very truly yours,
ABN AMRO Incorporated