Turning Point and Standard Diversified Announce Merger

Turning Point Brands (TPB) and Standard Diversified Inc. (SDI) have entered into a definitive agreement under which SDI will be merged into a wholly owned subsidiary of TPB in a tax-free downstream merger in a transaction first announced by the companies in November 2019.

Under the terms of the agreement, the holders of SDI’s Class A common stock and SDI’s Class B common stock will receive in the aggregate, in return for their SDI common stock, TPB voting common stock at a ratio of 0.97 of a share of TPB common stock for each share of TPB common stock held by SDI.

SDI has divested, or will prior to the merger divest, its assets of SDI other than its TPB common stock and has agreed that its net liabilities at closing will not exceed $25,000.

The transaction is subject to customary closing conditions, including approval by holders of a majority of the aggregate voting power of the SDI common stock and the receipt of any applicable regulatory approvals. The board of directors of SDI has recommended that its stockholders vote in favor of the transaction. The companies expect the transaction to close in the summer of 2020.