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Foxconn Finalizes Smart Buyout Agreement

Under the agreement, Foxconn has agreed to acquire all of the outstanding common shares of Smart for a cash payment of US$4.50 per Common Share

Smart Technologies and Foxconn Technology Group have entered into an arrangement agreement under which Foxconn has agreed to acquire all of the outstanding common shares of Smart for a cash payment of US$4.50 per Common Share. The US$4.50 per Common Share purchase price represents a premium of approximately 21% to the volume weighted average price over the last 90 trading days prior to announcement of the Arrangement on the NASDAQ Stock Market
According to the press release, he Arrangement Agreement provides for the implementation of the Arrangement by means of a plan of arrangement under the Business Corporations Act (Alberta). The Arrangement Agreement contains customary representations and warranties of each party, non-solicitation and interim operations covenants by Smart, and right to match provisions in favor of Foxconn. The Arrangement Agreement provides that any subsidiary of Hon Hai Precision Industry may participate in the investment in Smart, and strategic partners designated by Hon Hai Precision Industry may, collectively, participate in up to 33 1/3% of the investment. Further, the Arrangement Agreement provides that a termination fee of US$8.9 million will be payable by Smart in certain circumstances, including if Smart enters into an agreement with respect to a superior proposal or if its Board of Directors fails to recommend the proposed Arrangement to shareholders in the prescribed manner.

After consulting with its financial and legal advisors, the Board of Directors of Smart unanimously approved the Arrangement. The Board of Directors recommends that shareholders vote in favor of the Arrangement. Evercore is acting as lead financial advisor to Smart in connection with the Arrangement and Bennett Jones LLP and Sidley Austin LLP are serving as legal counsel. RBC Capital Markets is also acting as financial advisor to SMART. Moelis & Company is acting as exclusive financial advisor to Hon Hai and Akin Gump Strauss Hauer & Feld and Gowling WLG are serving as legal counsel.

Neil Gaydon, President and CEO of Smart said, “We are very excited by the proposed acquisition of Smart by Foxconn, who is the world’s largest electronics manufacturer. SMART has built an enviable global brand in both the education and enterprise spaces. The proposed transaction with Foxconn provides us with one of the strongest global electronics partners with access to significant resources, a broad range of new technologies, markets and financial resources that will enable us to accelerate our strategy and position Smart for significant future growth.”

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