Shareholders from both companies voted Wednesday to approve the deal that will make Rawlings Sporting Goods a wholly owned subsidiary of K2.
The deal will see each share of Rawlings approximately 8.1 million outstanding common shares converted into 1.080 shares of K2 common stock. The combined company will have approximately 26.7 million common shares outstanding.
The deal has had its ups and downs over the last five months, first due to a bidding fight with an investor that was formerly Rawlings largest shareholder, and more recently when K2 CEO Robert Heckman threatened to kill the deal struck in December due to issues with Rawlings contract with Major League Baseball.
MLB had the right to terminate its agreement with any change in ownership, but the final hurdle in the roughly $74 million merger deal was overcome late Monday and included a three year extension to 2008.
K2 has received approval from the New York Stock Exchange to list the K2 common stock newly issued in the merger. Trading of Rawlings common shares on the NASDAQ National Market will cease concurrent with the closing of the merger transaction.
Also on Wednesday, K2 announced a new three-year arrangement that includes a $205 million revolving credit facility and a $20 million term loan. Borrowings will be secured by substantially all of K2’s domestic, Canadian and United Kingdom assets. The new facility will replace K2’s approximately $63.9 million of outstanding borrowings under a revolving line of credit and senior notes, and to secure existing letters of credit.
In a related announcement, K2 laid off 38 people worldwide, most from its main offices in Vashon, WA, in what the company has termed an internal restructuring.
