Aladdin Knowledge Systems Enters Into Merger Agreement With Vector Capital Affiliate
January 12 2009 - 7:00AM
Marketwired
Aladdin Knowledge Systems Ltd. (NASDAQ: ALDN) today announced that
it has entered into a definitive merger agreement to be acquired by
an investor group lead by Vector Capital, a leading private equity
firm specializing in the technology industry, in a transaction
valued at approximately $160 million.
Under the terms of the agreement, Aladdin shareholders will
receive $11.50 per share in cash for each share of common stock
they hold. This represents a premium of approximately 20% over
Aladdin's closing share price on January 9, 2009, the last trading
day prior to today's announcement, and a premium of approximately
64% over Aladdin's closing share price on January 5, 2009, the last
trading day prior to Aladdin's announcement that it was in
continuing discussions with Vector Capital regarding a possible
strategic transaction.
"After extensive negotiations and careful and thorough analysis,
conducted with our independent advisors, the Board has unanimously
endorsed this transaction as in the best interests of the Company
and our shareholders," said Yanki Margalit, Chairman and CEO of
Aladdin Knowledge Systems.
Commenting on the announcement, David Fishman, Partner, Vector
Capital, said, "We are very excited about adding Aladdin to our
portfolio of outstanding technology companies and believe that
placing Aladdin's DRM and Authentication assets under common
management with those of our portfolio company, SafeNet Inc., a
global leader in information security, makes considerable strategic
sense and will greatly benefit all stakeholders. Aladdin is an
exceptional company, with significant potential and a strong
commitment to its employees, partners and customers worldwide. We
understand Aladdin's industry and business well, and look forward
to working collaboratively to ensure a smooth and expeditious
transition."
The transaction is subject to certain closing conditions,
including the approval of Aladdin's shareholders, antitrust
regulatory approvals, and the satisfaction of other customary
closing conditions. Approximately 14% of Aladdin's outstanding
shares in the aggregate are held by an affiliate of Vector Capital,
and Directors of Aladdin, including Mr. Margalit, have entered into
a voting agreement for 19% of the outstanding shares pursuant to
which they have agreed to vote all of their shares in favor of the
transaction. There is no financing condition to consummate the
transaction. The transaction is expected to close following the
satisfaction of all closing conditions, which is anticipated to
occur in the next two to three months. Wells Fargo Foothill, part
of Wells Fargo & Company (NYSE: WFC), has committed to provide
debt financing in support of the acquisition.
The transaction will be presented to Aladdin shareholders for
approval at Aladdin's Extraordinary General Meeting, which will be
scheduled as soon as practicable.
About Aladdin
Aladdin Knowledge Systems (NASDAQ: ALDN) is an information
security leader with offices in 15 countries, a worldwide network
of channel partners, and numerous awards for innovation. Aladdin
eToken is the world's #1 USB-based authentication solution,
offering identity and access management tools that protect
sensitive data. Aladdin SafeWord two-factor authentication
technology protects companies' important information assets and
applications. Aladdin HASP SRM boosts growth for software
developers and publishers through strong anti-piracy protection, IP
protection, and secure licensing and product activation. Aladdin
eSafe delivers real-time intelligent Web gateway security that
helps protect data and networks, improves productivity, and enables
compliance. Visit www.Aladdin.com.
About Vector Capital
Vector Capital is a leading private equity firm specializing in
spinouts, buyouts and recapitalizations of established technology
businesses. Vector identifies and pursues these complex investments
in both the private and public markets. Vector actively partners
with management teams to devise and execute new financial and
business strategies that materially improve the competitive
standing of these businesses and enhance their value for employees,
customers and shareholders. Among Vector's notable investments are
LANDesk Software, Savi Technology, SafeNet, Corel Corporation
(NASDAQ: CREL), Precise Software Solutions, Printronix,
Register.com, Tripos, WinZip and Watchguard Technologies. For more
information, visit www.vectorcapital.com.
Safe Harbor Statement
Certain information presented herein constitutes forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements are subject to
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the
Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such factors include general economic
and business conditions, risks relating to the Company's recent
acquisitions of Athena Smartcards, SafeWord and EutronSec,
including the failure to realize expected synergies, failure to
effectively integrate these businesses into its business and
increasing unexpected liabilities, the loss of market share,
changes in the level of business or anticipated business from a
large customer or customers, failure to achieve anticipated
customer orders, changes in the competitive landscape and other
factors over which the company has little or no control. The
completion of the Company's announced merger with an affiliate of
Vector Capital is subject to certain closing conditions, and the
Company cannot be certain that these conditions will be satisfied
or waived. For more information, please refer to the Company's
filings with the Securities and Exchange Commission, which are
available on the Commission's website at www.sec.gov.
�2009 Aladdin Knowledge Systems, Ltd. All rights reserved. HASP,
eToken, eSafe, Aladdin Knowledge Systems and the Aladdin logos are
trademarks or registered trademarks of Aladdin Knowledge Systems,
Ltd. All other product and brand names mentioned in this document
are trademarks or registered trademarks of their respective
owners.
Vector Capital Press Contact: Erin Becker
ebecker@BrunswickGroup.com 415-293-8461 Aladdin Press Contact:
Matthew Zintel Zintel Public Relations Matthew.zintel@zintelpr.com
310.574.8888 Aladdin Company Contact: Debbie Kaye Corporate
Communications Manager debbie.kaye@aladdin.com 646.468.0481
Aladdin Knowledge Systems Ltd (MM) (NASDAQ:ALDN)
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