CIMdata PLM Industry Summary Online Archive
26 April 2011
Acquisitions
Lawson Software Enters into Definitive Agreement to be Acquired by an Affiliate of Golden Gate Capital and Infor
Lawson Software, Inc. announced that it has signed a definitive agreement to be acquired by GGC Software Holdings, Inc., an affiliate of Golden Gate Capital and Infor, in a transaction valued at approximately $2 billion. Under the terms of the merger agreement, stockholders of Lawson will receive $11.25 per share in cash. Lawson’s board of directors unanimously approved the transaction and board members who collectively own approximately 9% of Lawson’s outstanding shares have agreed to vote their shares in favor of the transaction.
Today’s announcement marks the culmination of the company’s evaluation of strategic alternatives and review and negotiation of a proposal from Golden Gate and Infor that began prior to, and was later publicly confirmed in a press release on, March 11, 2011. During its evaluation, Lawson conducted a comprehensive market assessment and contacted other potential acquirers including competing global providers of enterprise applications and financial buyers, a process that did not result in a superior proposal. Following a thorough review and analysis of the strategic alternatives available to the company, Lawson’s board determined that this merger transaction is in the best interests of stockholders.
The transaction purchase price represents a valuation of approximately 2.5 times revenues, 12 times non-GAAP EBITDA and 23 times non-GAAP earnings per diluted share for the 12 months ended February 28, 2011. The $11.25 per share cash consideration represents a premium of approximately 14% to Lawson’s closing share price on March 7, 2011, the last trading day prior to news reports speculating about a potential transaction involving the company, and a premium of approximately 35% to Lawson’s average closing share price for the 52-week period prior to March 7, 2011. In addition, the purchase price represents a premium of approximately 28% to Lawson’s closing share price on January 10, 2011, the date prior to Lawson entering into a non-disclosure agreement with Infor.
“We are pleased to have entered into a transaction that will offer Lawson stockholders an attractive valuation,” said Harry Debes, Lawson’s president and chief executive officer. “After a thorough examination of the strategic alternatives available to the company as well as extensive discussions with Golden Gate and Infor, Lawson’s board unanimously concluded that this transaction is in the best interests of the company and our stockholders.”
“On behalf of Lawson’s board and management team, I would like to express our deep appreciation to our employees, whose passion and dedication have been key factors in making Lawson the great company it is today. We are also grateful to our customers and partners who have been instrumental in Lawson’s growth and development over the years. We look forward to working closely with the Golden Gate and Infor teams to ensure a smooth transition and complete the transaction as expeditiously as possible,” continued Mr. Debes.
“Lawson is a natural strategic partner for Infor, offering complementary software solutions that will extend our existing portfolio, particularly in areas such as healthcare, public sector, manufacturing and human capital management,” said Charles Phillips, CEO of Infor. “Lawson’s and Infor’s respective best-of-class solutions will enable us to expand our commitment to our customers, delivering comprehensive ERP suites. We look forward to working closely with the Lawson team to build upon our distinct core competencies to offer an enhanced product portfolio and customer service experience.”
Lawson will file a preliminary proxy statement with the U.S. Securities and Exchange Commission which will contain detailed information about the transaction. The preliminary proxy will outline the Lawson board's reasons for approving the merger and its comprehensive review of strategic alternatives.
The transaction is subject to customary closing conditions including the approval of Lawson's stockholders and regulatory approvals. The transaction has fully committed debt financing from Credit Suisse, Bank of America Merrill Lynch, Morgan Stanley, Royal Bank of Canada and Deutsche Bank. The transaction is currently expected to close in the third calendar quarter of 2011.
Barclays Capital, Inc. is acting as financial advisor to Lawson and Skadden, Arps, Slate, Meagher & Flom LLP is acting as its legal advisor.
About Golden Gate Capital
Golden Gate Capital is a San Francisco-based private equity investment firm with approximately $9 billion of capital under management. Golden Gate is dedicated to partnering with management teams to invest in change-intensive, growth businesses. The firm targets investments where there is a demonstrable opportunity to significantly enhance a company's value. The principals of Golden Gate have a long and successful history of investing with management partners across a wide range of industries and transaction types, including leveraged buyouts, recapitalizations, corporate divestitures and spin-offs, build-ups and venture stage investing. For more information, visit http://www.goldengatecap.com.
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