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2015-04-09

Transmode: Statement by the Board of Directors of Transmode in relation to Infinera's public offer

Stockholm, Sweden - 9 April 2015 - The Board of Directors of Transmode has
resolved to unanimously recommend the shareholders of Transmode to accept the
public offer from Infinera
Background
This statement is made by the Board of Directors (the "Board") of Transmode AB
(publ) ("Transmode" or the "Company") pursuant to section II.19 of the rules
concerning takeover bids on the stock market adopted by Nasdaq Stockholm (the
"Takeover Rules"). Since Pod Investment AB ("Pod") has entered into an
undertaking to tender its shares in Transmode in the Offer (as defined
below), the Board members Tom Nyman, Chairman of the Board of Transmode and
Director of Pod, and Axel Roos, Director of the Board of Transmode and CEO
and Director of Pod, have, due to conflict of interest, not participated in
the Board of Directors' handling of, or decisions relating to, the Offer,
including this statement. The remaining Board members in Transmode are
independent of Infinera Corporation ("Infinera").

Infinera, a company incorporated in the State of Delaware, United States, and
whose shares are listed on the NASDAQ Global Select Market in the United
States, has today, through a press release, announced a public offer to the
shareholders of Transmode to transfer all of their shares in Transmode to
Infinera for a consideration consisting of a mixture of cash and new shares
of common stock in Infinera (the "Offer"). Infinera is offering each
Transmode shareholder:

* in respect of approximately 72.48 percent of the Transmode shares tendered
by such shareholder: approximately 0.6492 Infinera shares per Transmode
share; and
* in respect of the remaining approximately 27.52 percent of the Transmode
shares tendered by such shareholder: SEK 109.00 in cash per Transmode
share[1].

Based on Infinera's closing share price of USD 19.43[2]as of 8 April 2015, the
Offer values each Transmode share at SEK 109.00, and the total value of the
Offer is approximately SEK 3,020 million[3]. The Offer represents a premium
of:

* approximately 46 percent compared to the six month volume-weighted average
share price of SEK 74.80 for the Transmode share on Nasdaq Stockholm, up to
and including 8 April 2015, the last trading day prior to announcement of
the Offer;
* approximately 32 percent compared to the three month volume-weighted
average share price of SEK 82.75 for the Transmode share on Nasdaq
Stockholm, up to and including 8 April 2015, the last trading day prior to
announcement of the Offer;
* approximately 20 percent compared to the one month volume-weighted average
share price of SEK 90.58 for the Transmode share on Nasdaq Stockholm, up to
and including 8 April 2015, the last trading day prior to announcement of
the Offer; and
* approximately 13 percent compared to the closing share price of SEK 96.50
for the Transmode share on Nasdaq Stockholm on 8 April 2015, the last
trading day prior to announcement of the Offer.

The acceptance period for the Offer is expected to run from and including 26
June 2015 to and including 17 July 2015. The Offer is conditional upon, inter
alia, that it is accepted to the extent that Infinera becomes the owner of
more than 90 percent of the total number of shares in Transmode, that
Infinera's Registration Statement on Form S-4 in the United States, which
will register the offer and issuance of the new Infinera shares, becomes
effective under the Securities Act of 1933, as amended, and not being the
subject of any stop order or proceeding seeking a stop order by the
Securities and Exchange Commission and that the new Infinera shares to be
issued under the Offer are approved for listing on NASDAQ Global Select
Market. The Offer is not conditional upon financing. For further details,
please refer to Infinera's Offer announcement.

In Infinera's Offer announcement, it is stated that Infinera has initiated
discussions with Nasdaq Stockholm and is evaluating whether to apply for a
secondary listing on Nasdaq Stockholm, in addition to its current listing on
the NASDAQ Global Select Market in the United States.

The Board has, at the written request of Infinera, permitted Infinera to carry
out a limited confirmatory due diligence review of certain business,
financial and legal information relating to Transmode in connection with the
preparation of the Offer. In connection with such due diligence
investigation, Infinera has received information regarding some of
Transmode's financial results for the first quarter of 2015, a summary of
which will be published by Transmode today in a separate press release.
Besides the above, Infinera has not received any information which has not
been previously disclosed and which could reasonably be expected to affect
the price of the shares in Transmode in connection with its due diligence
investigation. Transmode has also, with the assistance of PwC and Hannes
Snellman, performed a limited due diligence review of certain business,
financial and legal information relating to Infinera.

Pod, the largest shareholder in Transmode who holds approximately 33 percent
of the shares in Transmode, has entered into an undertaking with Infinera to
accept the Offer, subject to certain conditions, as further described in
Infinera's Offer announcement. Pod has also agreed not to dispose of the
Infinera shares received as consideration for the Transmode shares tendered
in the Offer during a certain period (the "Holding Period"). The Holding
Period will commence upon settlement of the Offer and will continue until all
of the Infinera shares received have been released from the holding
restrictions pursuant to the following. One-fifth (1/5) of the shares shall
be released from the holding restrictions on the forty-fifth day after
settlement of the Offer. One-fifth (1/5) of the shares shall be released from
the holding restrictions each month thereafter on the same day of the month
as the day of the settlement of the Offer.

The Board's recommendation

The Board's opinion of the Offer is based on a joint assessment of a number of
factors that the Board has considered relevant in relation to the evaluation
of the Offer. These factors include, but are not limited to, Transmode's
present position, the expected future development of the Company and thereto
related possibilities and risks.

In the Board's opinion, Transmode has a well defined and viable strategy going
forward, however the Board views a combination of Transmode and Infinera as
positive and believes it to be strategically merited, and the share
consideration allows the Company's shareholders to take part of the combined
accelerated growth story and combination benefits.

The combination of Infinera and Transmode would create one of the leading
global vendors of end-to-end optical transport solutions, spanning Longhaul
and Metro applications. The combined worldwide sales operations will increase
market coverage and open a larger part of the growing optical networking
market fuelling new growth opportunities. Furthermore a broader and enhanced
product portfolio can be developed combining expertise from the Company and
Infinera in OTN, Ethernet and optical technologies. The combined Infinera and
Transmode operations will together be well positioned to face challenges
associated with growing in the networking equipment industry, including the
requirement to invest in new markets and products.

The Board believes there are a number of strategic benefits to Transmode from
combining its operations with Infinera:

* Differentiated and comprehensive product portfolio with Transmode Metro
aggregation and access products, combined with Infinera long-haul products
* World class R&D and engineering organization with complementary strengths
to develop market leading solutions. The companies' similar engineering
culture will create a strong platform for successful integration
* Complementary geographical footprint with Transmode strengths in Europe and
Infinera strengths in North America
* Cross-selling opportunities to complementary customer-bases
* Addressing a larger portion of the optical networking market and engineer
better products with fast time-to-market

Since the initial public offering of Transmode, the Transmode shareholder base
has been concentrated and the liquidity of Transmode's share has been
limited. During the last twelve months up to and including 8 April 2015, 25
percent of the outstanding shares of the Company have been traded. The Board
views the relatively higher liquidity in the Infinera share as positive for
the shareholders of Transmode.

The Board has had discussions with other industrial companies, but the
combination with Infinera is in the view of the Board the best current
option.

In its evaluation of the Offer, the Board also takes into account that
Transmode's largest shareholder, Pod, representing approximately 33 percent
of the shares, has expressed its support for the Offer by signing an
undertaking to accept the Offer and entering into a lock-up agreement.
Furthermore, the Board notes that Thomas J. Fallon, CEO of Infinera, and
David F. Welch, Co-Founder of Infinera, have, subject to certain exemptions,
entered into similar lock-up restrictions on their shares in Infinera.

Furthermore, the Board has obtained a fairness opinion from Lenner&Partners
regarding the Offer which was delivered to the Board on 9 April 2015.
Lenner&Partners' opinion, which is set forth in an appendix to this press
release, is that the Offer is fair from a financial point of view for the
shareholders in Transmode,Appendix 1.

Under the Takeover Rules, the Board shall also, based on what Infinera has
expressed in its announcement of the Offer, present its views on the impact
the completion of the Offer will have on Transmode, especially employment,
and its views on Infinera's strategic plans for Transmode and the impact
these could be expected to have on employment and on Transmode's business
locations. The Board notes that Infinera in its offer announcement states
that Infinera recognizes the skills and capabilities of Transmode's
management and employees and wishes to maintain an excellent relationship
with them. It is further stated that for the near-term, Infinera does not
intend to make any material changes to Transmode's employees or to
Transmode's existing organization and operations, including the terms of
employment and locations of the business. Each company's engineering
structure is anticipated to remain substantively intact and Infinera intends
to have Transmode's current CEO lead the Metro Aggregation business
operations of the combined company. Infinera states that for the long-term,
the optimal structures of each function will be determined during the period
following the completion of the Offer and the creation of the combined
company, after an assessment of the combined c...

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