Covisint Strongly Recommends Shareholders Vote "FOR" the Sale of Covisint to Open Text
July 24 2017 - 9:05AM
Covisint Corporation's (Nasdaq:COVS) special shareholder
meeting to vote on Covisint’s proposed acquisition by OpenText™
(NASDAQ:OTEX) (TSX:OTEX) is scheduled for tomorrow, Tuesday, July
25, 2017, at 10:00 a.m. ET. As of the date of this press
release, not all Covisint shareholders have voted. The
upcoming Special Meeting, and your vote, is important in
determining the best outcome for our shareholders. Covisint
shareholders of record as of the close of business on June 15, 2017
are entitled to vote at the Special Meeting.
The Covisint Board’s unanimous recommendation is that
you vote "FOR" the Proposal to Approve the Sale of the Company to
Open Text for $2.45 per share.
Covisint also takes note of Open Text’s indication that while it
remains fully committed to closing the proposed merger, Open Text
does not intend to increase the consideration offered to Covisint’s
shareholders.
For the reasons enumerated below, Covisint believes Open Text’s
offer is fair and in the best interests of Covisint’s
shareholders.
The merger consideration of $2.45 represents the highest bid
after an exhaustive, seven-month process involving 52 interested
parties. The merger consideration of $2.45 also represents a
premium of approximately:
- 23% to the closing price per share of the Company’s common
stock on June 2, 2017;
- 27% to the volume-weighted average trading price per share of
the Company’s common stock for the 30-day period ending on June 2,
2017; and
- 46% to the cash-adjusted price per share of the Company’s
common stock for the 30-day period ending on June 2, 2017 (the
cash-adjusted calculation deducts the Company’s cash and cash
equivalents of $33 million, or $0.79 per share, as of March 31,
2017, from both its current share price and from the total value of
the merger consideration in order to better measure the premium
being offered).
As a result of Covisint’s lack of revenue growth and
disappointing bookings performance since the Company’s IPO and at
the urging of Covisint’s shareholders, the Board began an
exhaustive review of strategic alternatives. The Board's
recommendation to accept Open Text's offer came after a review of
all such strategic options for Covisint's future, including
continuing standalone operations paired with aggressive cost
reductions to achieve profitability. Aggressive cost
reductions would likely (1) significantly impede or eliminate
product development efforts to keep our products competitive in the
marketplace, (2) result in organizational changes reducing the
personnel that our customers count on for service and support, and
(3) risk our business and contractual relationships with those
customers.
The Board unanimously approved Open Text's offer, which included
the approval of three new directors appointed to the Board within
the last year after negotiations with certain activist
shareholders. The proposed merger has been evaluated by
Institutional Shareholder Services, Glass, Lewis & Co. and
Egan-Jones, who recommend shareholders vote "For" the acquisition
of Covisint by Open Text.
About Covisint Corporation
Covisint is the connected company – we securely connect
ecosystems of people, systems and things to enable new service
offerings, optimize operations, develop new business models and
ultimately enable the connected economy. Today, we support
more than 2,000 organizations and connect to more than 212,000
business partners and customers worldwide. Learn more at
www.covisint.com.
Follow us:
- Covisint on Twitter
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- Covisint on Facebook
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements,
including statements regarding Covisint’s present and future
technology design, architecture, performance and operations which
affects the Covisint IoT Platform’s market growth and the demand
for Covisint’s solutions. Any forward-looking statements
contained in this press release are based upon Covisint’s
historical performance and its current plans, estimates and
expectations and are not a representation that such plans,
estimates, or expectations will be achieved. These
forward-looking statements represent Covisint’s expectations as of
the date of this press release. Subsequent events may cause
these expectations to change, and Covisint disclaims any obligation
to update the forward-looking statements in the future except as
may otherwise be required by the federal securities laws.
These forward-looking statements are subject to known and unknown
risks and uncertainties that may cause actual results to differ
materially. Important factors that could cause actual results
to differ materially from those in the forward-looking statements
include, but are not limited to, Daimler’s ability non-renew the
purchase order or to terminate our contract for convenience.
Further information on potential factors that could affect actual
results is included in Covisint’s reports filed with the SEC.
Investor Relations Contact
866-319-7659
investors@covisint.com
Media Contact
Brad Schechter, Vice President, Corporate Marketing
248-483-2097
bschecht@covisint.com
For Sales and Marketing Information
Covisint Corporation, 26533 Evergreen Road, Suite 500, Southfield, MI 48076, 800-229-4125
http://www.covisint.com
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