Independent proxy advisory firms Glass Lewis & Co. and Institutional Shareholder Services recommended in their respective reports that shareholders of Vectrus (NYSE: VEC) vote in favor of all proposals related to the planned combination with Vertex during a special meeting to be held on June 15.
Chuck Prow, CEO of Vectrus and an eight-time Wash100 winner, said in a statement published Wednesday the company is pleased with the recommendations of ISS and Glass Lewis and that the management team and the board are confident that the proposed merger will enable Vectrus to expand its portfolio of technologies to deliver full lifecycle support services across the converged environment.
âWith increased scale and meaningful synergies, the combined company will be more competitive in the national security environment while enhancing the delivery of services to our federal clients,â Prow added.
In March, Vectrus and Vertex agreed to merge to form a government services company that would deliver mission-critical platforms and support to defense customers worldwide.
“The combined company is also expected to have a more diversified revenue base across geographies, clients and contract types in supporting missions for the U.S. Department of Defense and other governmental agencies,â Glass Lewis said in its Wednesday report.
In its June 3 report, ISS said the proposed combination is expected to be accretive to free cash flow and earnings, bring about cost synergies and deliver projected tax benefits to the combined entity, which âwill have increased scale and geographic, client, and contract diversity.â
The companies expect the all-stock transaction to close in the third quarter of 2022, subject to approvals by regulatory authorities and Vectrus shareholders and other customary closing conditions.
