NEW YORK, Dec. 10, 2018 /PRNewswire/ -- Apis Capital
Management announced today that its private equity fund, Apis
Ventures, has submitted an all-cash offer to the Board of Directors
of Veritone, Inc. (NASDAQ: VERI) to acquire all of the outstanding
shares of Veritone for $10.26 per
share. As a result of careful consideration of the opportunity,
Apis has increased its initial offer and has communicated this
offer in the Letter to the Board attached below. This offer
represents a 93% premium over the closing price of Veritone Common
Stock on December 4, 2018, the date
of Apis's initial private written proposal to Veritone, and an 82%
premium over the closing price on December
7, 2018, the last trading day prior to this announcement,
with a total equity value of approximately $198 million.
"We have determined it is necessary to take our offer directly
to Veritone stockholders in order to deliver significant value to
them as expeditiously as possible," said Managing Partner of Apis
Capital Management, Dr. Edgar Radjabli. "This compelling
transaction would deliver immediate liquidity to Veritone
stockholders, at a premium to Veritone's prospects as a stand alone
company. Veritone shareholders have seen the management of the
company unable to deliver value since its IPO, nor has management
been able to provide a compelling vision for a turnaround in the
company's business, and we believe our proposal represents the best
possible outcome." Dr. Radjabli concluded, "We are committed to
completing this transaction and remain willing to work
cooperatively with Veritone. Our vision for the company involves
significant synergy with our growing portfolio of AI and machine
learnings investments, opening up new opportunities for Veritone's
technology."
Apis Capital Management believes that there are no regulatory
impediments to the proposed transaction and that it will receive
all necessary approvals and be completed by March 2019.
Apis Capital Management has engaged in an initial productive
discussion with Veritone to explore the merits and potential terms
of a transaction, yet Veritone has stalled in moving forward with
substantive discussions. Apis looks forward to continuing to work
with Veritone to complete this transaction in an expeditious
manner, for the benefit of the shareholders. The proposal is
subject to confirmatory due diligence and negotiation of definitive
documentation.
Shift4 Capital, a New York and
Florida based investment bank, is
acting as financial advisor to Apis, and Duane Morris LLP is acting
as legal counsel.
Below is the text of the letter that was sent on December 10, 2018 to Veritone's CEO, Chad Steelberg and its Board of Directors:
777 South Flagler Dr
Suite 800
West Palm Beach, FL, 33401
Phone: (561) 837-7311
December 10, 2018
VIA EMAIL AND OVERNIGHT COURIER
Board of Directors
Veritone, Inc.
c/o Mr. Chad Steelberg
Chief Executive Officer and Chairman of the Board
575 Anton Blvd.
Costa Mesa, CA 92626
Dear Chad,
Thank you for your request for additional information in
response to the proposal from Apis Capital Management on behalf of
Apis Ventures LLC (collectively, "Apis") that was sent to you and
the Board of Directors of Veritone, Inc. ("Veritone") on
December 4th, 2018. We believe
that we have provided you with all the information requested in
your response; however, we have unfortunately not heard back from
you by the time we noted in our letter.
As indicated in the proposal, we believe that executing the
proposed transaction in a timely manner would be beneficial to
Veritone stockholders. We believe that the proposed transaction
represents a compelling opportunity for Veritone stockholders to
monetize their investment in Veritone at a substantial premium to
Veritone's current share price.
We have held discussions with our financing sources and would
expect to have a fully executed, underwritten financing commitment
prior to execution of a definitive merger agreement.
We have retained appropriate legal, financial and other advisors
to assist us with this transaction. We stand ready to engage
in due diligence immediately and anticipate that our confirmatory
due diligence could be completed within two weeks following our
receipt of the requested materials.
In addition, we have held preliminary discussions with certain
of Veritone's significant stockholders and have reason to believe
such stockholders would be supportive of a transaction of the
nature described in this letter.
In light of the important stockholder interests at stake and
given your delay to date to substantively engage in meaningful
discussions regarding a negotiated transaction, we believe that it
is imperative to inform Veritone stockholders of our proposal. In
addition, in order to deliver maximum stockholder value, we have
enhanced our proposed price to $10.26
per share, representing an 82% premium over Veritone's last closing
price of $5.63 per share as of
December 7, 2018. We believe
that this all-cash offer is compelling for Veritone and its
stockholders and, accordingly, we are making this letter public
simultaneously with its delivery to you.
Our strong preference is to engage with Veritone's Board of
Directors to quickly reach a negotiated agreement and deliver on
the compelling value that our offer represents. However, we reserve
the right to commence a tender offer to purchase all of the
outstanding shares of common stock of Veritone at any time.
We believe that Veritone's stockholders would not be well served by
any further delay in negotiating and completing the proposed
transaction. Any further delay works against the interest of
Veritone's stockholders given Veritone's recent operating
performance and financial condition and its prospects as a
standalone company. We place significant value on the ability to
close this transaction quickly, and there can be no assurance that
in the future Apis Capital Management or any other buyer would pay
the same high premium that we are offering today.
Should Veritone's Board of Directors determine to proceed with a
negotiated transaction, we stand ready to meet with you to discuss
all aspects of our proposal. If Veritone is interested in
discussing a possible negotiated transaction, please contact us as
soon as possible.
Regards,
Edgar Radjabli
Managing Partner
Apis Capital Management
777 South Flagler Dr, Suite 800
West Palm Beach, FL, 33401
Phone: (561) 837-7311
emr@apiscapitalfunds.com
Apis Ventures
Apis Ventures is a Private Equity fund headquartered in
West Palm Beach, FL and is managed
by Apis Capital Management, a specialist alternative asset manager.
Apis focuses on investing in, and acquiring companies in the AI, ML
and DL space which have strong intellectual property or proprietary
technology but are undervalued as a result of slow development
progress or management issues. The Apis Ventures investment thesis
centers on the transformational impact of machine learning on the
vast data sets created by the digital revolution, and the profound
impact of successful application of the technology on industries
from financial services to healthcare. Apis seeks out opportunities
where the team knows it can add value through private ownership,
cross-portfolio synergies, and management leadership.
Additional Information
This communication is neither an offer to purchase nor a
solicitation of an offer to sell any shares of the capital stock of
Veritone or any other securities. No tender offer for
Veritone's shares has been made at this time. In connection
with the proposed transaction, Apis Ventures and/or one or more of
its affiliates may file tender offer documents with the U.S.
Securities and Exchange Commission ("SEC"). VERITONE'S
STOCKHOLDERS ARE ADVISED TO READ THESE AND ANY OTHER DOCUMENTS
FILED WITH THE SEC (AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM
TIME TO TIME) CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED TRANSACTION AND THE PARTIES THERETO.
Investors and security holders may obtain a free copy of these
documents (if and when available) and other documents filed with
the SEC by Apis Ventures and/or its affiliates at the website
maintained by the SEC at www.sec.gov or by directing such requests
to Apis Ventures at 777 South Flagler Drive Suite 800, West Palm Beach, FL, 33401.
Cautionary Note Concerning Forward-looking Statements
This communication contains both historical and forward-looking
statements, including concerning the intent, belief or current
expectations with respect to the proposed acquisition of Veritone
and all statements other than statements of historical fact.
These statements are based on current expectations of future
events. If underlying assumptions prove inaccurate or unknown risks
or uncertainties materialize, actual results could vary materially
from expectations and projections. Such risks or
uncertainties include, but are not limited to, the possibility that
Veritone may not be willing to enter into a definitive agreement
with respect to the transaction with Apis Ventures or an affiliate
thereof, the possibility that Apis Ventures or an affiliate thereof
may choose not pursue a transaction with Veritone, the timing to
consummate a potential transaction between Apis Ventures or an
affiliate thereof and Veritone and the ability and timing to obtain
any required approvals for the transaction. All
forward-looking statements speak only as of the date of this
communication or as of the date they are made, and Apis does not
undertake to update any forward-looking statement as a result of
new information or future events or developments except to the
extent required by law.
Media Contact:
Rodney Goedhart
Media Relations
Innowire Inc
4142 Adams Ave. Suite 103-207
San Diego, CA, 92116
Phone: (619) 940 1412
rodney.goedhart@innowire-advisory.com
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SOURCE Apis Capital Management