Gabelli Asset Management
May 23, 2005 -- The Gabelli Equity Trust Inc. (GAB) and Sterling Capital Corporation (SPR) announced today that they had entered into an agreement and plan of reorganization under which The Gabelli Equity Trust Inc. would acquire substantially all of the assets of Sterling Capital Corporation in exchange for shares of The Gabelli Equity Trust Inc.'s common stock. The transaction requires the approval of Sterling Capital Corporation's shareholders. Following completion of the transaction, the shareholders of Sterling Capital Corporation will be stockholders of The Gabelli Equity Trust Inc.
"We wish to welcome the shareholders of Sterling to The Gabelli Equity Trust," said Mario J. Gabelli, Chairman of The Gabelli Equity Trust Inc.
Wayne S. Reisner, President of Sterling, said "I am pleased that we have been able to come to an agreement with Gabelli. This represents a great opportunity for Sterling's shareholders."
Under the agreement, The Gabelli Equity Trust Inc. will issue that number of shares of its common stock to Sterling equal to the value of Sterling's net assets divided by the net asset value of one share of the Equity Trust's common stock on the effective date of the transaction, provided that if the average price of the Equity Trust's common stock on the NYSE for the 20 business days prior to the effective date of the transaction exceeds the net asset value per share of its common stock on the effective date, then the number of Equity Trust shares to be issued will be computed by dividing the value of Sterling's net assets on the effective date by the lower of (x) such 20 day average price and (y) 103% of the Equity Trust's net asset value on the effective date of the transaction. Sterling will distribute to its shareholders the Equity Trust stock it receives as soon as practicable after the closing of the transaction.
Sterling Capital Corporation is a diversified, closed-end investment company with $18 million in total assets and a primary investment objective of long-term capital growth.
The Gabelli Equity Trust Inc. is a non-diversified, closed-end investment company with $1.6 billion in total assets whose primary objective is long-term growth of capital and whose secondary objective is income. The Gabelli Equity Trust Inc. is managed by Gabelli Funds, LLC, a subsidiary of Gabelli Asset Management Inc. (GBL), which is a publicly traded NYSE listed company.
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