Indigo Books & Music shareholders to vote on privatization sale

Indigo Books & Music Inc. shareholders have voted to take the company private. On Monday, they approved a $2.50 per share offer from Trilogy Retail Holdings Inc. and Trilogy Investments L.P. These companies, owned by Gerald Schwartz, who is married to Indigo's CEO Heather Reisman, hold a 56% stake in the bookstore chain.

Originally, Trilogy offered $2.25 per share but raised their bid in April. The deal needed a two-thirds majority vote from all shareholders and a simple majority from those not affiliated with Trilogy. In the end, 95.09% of votes supported the deal, with 83% of unaffiliated shareholders also in favor.

Heather Reisman expressed her satisfaction with the vote, emphasizing a continued commitment to customers and stakeholders. Indigo spokesperson Madison Downey confirmed that Trilogy would not comment on the vote.

The decision to go private aims to help Indigo avoid the scrutiny that comes with being a publicly traded company, allowing it to focus on regaining profitability and growth. This move comes after a challenging period for Indigo, including a cyberattack that took down its website, several quarterly losses, layoffs in January, and significant changes in board members.

Professor Richard Leblanc from York University noted that avoiding public reporting could benefit Indigo, which has faced numerous difficulties. Indigo’s issues have been compounded by inflation and high interest rates, leading to cautious consumer spending, especially on non-essential items.

In response, Indigo has been implementing a transformation plan, which includes removing certain products from shelves and replacing Starbucks locations with Columbus Café & Co. Additionally, Reisman has promised to enhance store experiences with digital inventory kiosks, more events, and added seating.

Retail expert Liza Amlani believes privatization could provide the needed shakeup for Indigo, allowing Reisman more freedom to implement her vision with Trilogy’s backing.

The offer, reflecting a 69% premium on Indigo's initial share price when the bid was made, saw no significant opposition. The deal, endorsed by a special committee of independent directors and recommended by proxy advisory firms, now awaits final court approval and will result in Indigo's shares being delisted from the Toronto Stock Exchange.