Exhibit 53
XXXXXX BROTHERS
March 29, 1998
Board of Directors
Metromail Corporation
000 Xxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Members of the Board:
We understand that Metromail Corporation (the "Company"), The Great Universal
Stores P.L.C. ("XXX") and XXX Acquisition Corp., a subsidiary of XXX ("Newco,"
and, together with XXX, the "Bidder") have entered into an Agreement and Plan of
Merger (the "Merger Agreement") and related Stock Purchase Agreements (the
"Stock Purchase Agreements"), each dated as of March 12, 1998, which provide,
among other things, for (i) the tender offer by Newco for all outstanding shares
of common stock, together with certain associated rights, of the Company for
consideration of $34.50 net per share in cash (the "Tender Offer"), and (ii) the
subsequent merger (the "Merger," and together with the Tender Offer, the
"Proposed Transaction") of Newco with and into the Company, pursuant to which
each outstanding share of the common stock of the Company (other than shares
held in treasury or held by the Bidder or any of its affiliates or as to which
dissenters' rights are exercised) will be converted into the right to receive
consideration of $34.50 net per share in cash. The terms and conditions of the
Proposed Transaction are set forth in more detail in the Merger Agreement.
We have been requested by the Board of Directors of the Company to render our
opinion with respect to the fairness, from a financial point of view, to the
Company's stockholders of the consideration to be offered to such stockholders
in the Proposed Transaction. We have not been requested to opine as to, and our
opinion does not in any manner address, the Company's underlying business
decision to proceed with or effect the Proposed Transaction.
In arriving at our opinion, we reviewed and analyzed: (i) the Merger Agreement,
the Stock Purchase Agreements and the specific terms of the Proposed
Transaction, (ii) publicly available information concerning the Company that we
believe to be relevant to our analysis, (iii) financial and operating
information with respect to the business, operations and prospects of the
Company furnished to us by the Company, (iv) a trading history of the Company's
common stock from June 13, 1996, its initial public offering date, to the
present and a comparison of that trading history with those of other companies
that we deemed relevant, (v) a comparison of the historical financial results
and present financial condition of the Company with those of other companies
that we deemed
Board of Directors
Metromail Corporation
March 29, 1998
Page 2 of 3
relevant, and (vi) a comparison of the financial terms of the Proposed
Transaction with the financial terms of certain other recent transactions that
we deemed relevant. We also have had discussions with the management of the
Company concerning its business, operations, assets, financial condition and
prospects and have undertaken such other studies, analyses and investigations as
we deemed appropriate.
In addition, we have also considered the results of our efforts to solicit
indications of interest from third parties with respect to the purchase of the
Company and reviewed and analyzed (i) the terms of the offer to purchase the
Company received from American Business Information, Inc., (ii) the risks of
such offeror being unable to consummate its proposed acquisition of the
Company, and (iii) the time that may be required for such offeror to consummate
its proposed acquisition of the Company.
In arriving at our opinion, we have assumed and relied upon the accuracy and
completeness of the financial and other information provided by the Company and
used by us without assuming any responsibility for independent verification of
such information and have further relied upon the assurances of management of
the Company that they are not aware of any facts or circumstances that would
make such information inaccurate or misleading. With respect to the financial
projections of the Company, upon advice of the Company we have assumed that such
projections have been reasonably prepared on a basis reflecting the best
currently available estimates and judgments of the management of the Company as
to the future financial performance of the Company and that the Company will
perform substantially in accordance with such projections. In arriving at our
opinion, we have not conducted a physical inspection of the properties and
facilities of the Company and have not made or obtained any evaluations or
appraisals of the assets or liabilities of the Company. Our opinion necessarily
is based upon market, economic and other conditions as they exist on, and can be
evaluated as of, the date of this letter.
Based upon and subject to the foregoing, we are of the opinion as of the date
hereof that, from a financial point of view, the consideration to be offered to
the stockholders of the Company in the Proposed Transaction is fair to such
stockholders.
We have acted as financial advisor to the Company in connection with the
Proposed Transaction and will receive a fee for our services which is contingent
upon the consummation of the Proposed Transaction. In addition, the Company has
agreed to indemnify us for certain liabilities that may arise out of the
rendering of this opinion. We also have performed various investment banking
services for the Company in the past (including acting as co-manager for the
Company's initial public offering and as financial advisor to the Company in its
acquisition of Atlantes Corporation) and have received customary fees for such
services. In the ordinary course of our business, we actively trade in the
equity securities of the Company for our own account and for the accounts of our
customers and, accordingly, may at any time hold a long or short position in
such securities.
Board of Directors
Metromail Corporation
March 29, 1998
Page 3 of 3
This opinion is for the use and benefit of the Board of Directors of the Company
and is rendered to the Board of Directors in connection with its consideration
of the Proposed Transaction. This opinion is not intended to be and does not
constitute a recommendation to any stockholder of the Company as to whether to
accept the consideration to be offered to the stockholders in connection with
the Proposed Transaction.
Very truly yours,
XXXXXX BROTHERS
