Avid Enters Into a Definitive Agreement to Acquire Orad Hi-Tec Systems for EUR5.67 Per Share
April 12 2015 - 7:38PM
Avid (Nasdaq:AVID) today announced that it has signed a definitive
agreement to acquire Orad Hi-Tec Systems Ltd., a Frankfurt stock
exchange-listed public company with its headquarters in Kfar Saba,
Israel, for €5.67 per share in an all-cash transaction. Orad is a
leading provider of state-of-the-art 3D real-time graphics, video
servers and related asset management solutions. The acquisition is
consistent with Avid's stated growth strategy and Avid believes it
will continue to deliver on the company's Avid Everywhere vision,
by adding key content creation and media management solutions to
the Avid MediaCentral Platform, the industry's most open,
innovative and comprehensive media platform.
Transaction Highlights
- Avid expects that the combined company will further Avid's
position as the most comprehensive provider of content creation to
distribution workflows for broadcast and media customers around the
world.
- Avid believes the addition of Orad's products to the Avid
platform will further enhance the value of the platform to Avid
customers.
- Joining the larger Avid organization opens opportunities for
Orad to gain operating efficiencies and to make the innovation
investments most important to Orad customers.
- Avid expects the transaction to be accretive on an Adjusted
EBITDA and cash flow basis, and will be financed by a new $100
million senior subordinated credit facility.
"We have followed Orad's success in the market for many years
and are excited about the prospects of what our combined companies
can accomplish," said Louis Hernandez, Jr, Chairman, President, and
CEO of Avid. "Our industry is in a period of significant
transition, in which our customers are demanding a single platform
to connect creation with collaboration, asset protection,
distribution and monetization. We believe this transaction further
differentiates Avid as the partner with the most comprehensive
solution, and accelerates our momentum as we enable our customers
to operate more efficiently and profitably."
"Avid has a long-standing heritage of industry leadership, and
it's clear that both Avid and Orad have a common commitment to
innovation and customer success," said Avi Sharir, CEO and
President of Orad. "Our solutions are highly complementary to the
Avid product suite, and together we believe we can create the most
comprehensive solution for the media industry. Further, Avid's
global scale and distribution network provide significant
opportunities for customer support, growth and market
expansion. We are confident that joining the Avid family will
create more powerful opportunities for our customers, partners, and
employees."
Transaction Overview
Under the terms of the definitive agreement, Avid has agreed to
pay €5.67 in cash for each share of Orad common stock which, at
today's exchange rate equals approximately $60 million, net of
estimated cash acquired. "We believe this valuation represents an
approximate 6x multiple of EBITDA, net of estimated cost synergies
leveraging our platform thus generating attractive economics for us
and a richer more efficient experience for our customers," said
John Frederick, Avid's Executive Vice President, Chief
Administrative and Financial Officer. The transaction is
subject to customary closing conditions, including approval by 75%
of Orad's shareholders and closing is expected to take place in
June 2015. Avid has entered into voting agreements with holders of
a majority of Orad's outstanding shares of capital stock, pursuant
to which they agree to vote in favor of the transaction. Avid
intends to fund the purchase price with a $100 million secured term
loan for which it has received a financing
commitment.
More Information
Avid today has posted a presentation providing more information
on the transaction on its investor relations website. The
presentation can be accessed on Avid's Investor Website.
About Orad
Orad is a world-leading provider of real-time 3D broadcast
graphic, video server, and media asset management solutions
including news, channel branding, sports production and
enhancement, elections and special events, virtual studios, and
virtual advertisement. Orad's compelling solutions streamline
production workflow, enhance viewer experience, and improve
production value. Founded in 1993, Orad is a public company listed
on the Frankfurt Stock Exchange (OHT). More information is
available at http://www.Orad.tv/.
About Avid
Through Avid Everywhere™, Avid delivers the industry's most
open, innovative and comprehensive media platform connecting
content creation with collaboration, asset protection, distribution
and consumption for the most listened to, most watched and most
loved media in the world—from the most prestigious and
award-winning feature films, music recordings, and television
shows, to live concerts and news broadcasts. Industry leading
solutions include Pro Tools®, Media Composer®, ISIS®, Interplay®,
and Sibelius®. For more information about Avid solutions and
services, visit www.Avid.com, connect with Avid on Facebook,
Instagram, Twitter, YouTube, LinkedIn, or subscribe to Avid
Blogs.
Forward Looking Statement
The information provided in this press release includes
forward-looking statements that involve risks and uncertainties.
Such statements are made in reliance upon the safe harbor
provisions of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Forward-looking
statements include but are not limited to: statements about the
expected timing and completion of the proposed transaction and
financing, the anticipated benefits of the proposed transaction,
including estimated synergies; the effects of the proposed
transaction, including effects on future financial and operating
results; and other statements that are not historical facts. Among
the risks and uncertainties that could cause actual results to
differ from those described in forward-looking statements are the
following: the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement; the possibility that Orad's shareholders may not approve
the merger agreement; the risk that financing for the proposed
transaction may not be obtained on anticipated terms or at all;
risks related to disruption of management time from ongoing
business operations due to the proposed transaction; the risk that
Avid may fail to realize the benefits expected from the proposed
transaction; the risk that the integration of Orad into Avid may
not progress as anticipated; the risk that any announcements
relating to the proposed transaction could have adverse effects on
the market price of Avid's common stock; and the risk that the
proposed transaction and its announcement could have an adverse
effect on the ability of Avid and Orad to retain customers and
retain and hire key personnel and maintain relationships with their
suppliers and customers; and on their operating results and
businesses generally. The risks included above are not
exhaustive. Other factors that could adversely affect Avid's
business and prospects are described in the filings made by Avid
with the SEC. Avid expressly disclaims any obligation or
undertaking to update or revise any forward-looking statements
whether as a result of new information, future events or
otherwise
© 2015 Avid Technology, Inc. All rights reserved. Avid, the Avid
logo, Avid Everywhere, iNEWS, Interplay, ISIS, Media Composer, Pro
Tools, and Sibelius are trademarks or registered trademarks of Avid
Technology, Inc. or its subsidiaries in the United States and/or
other countries. The Interplay name is used with the permission of
the Interplay Entertainment Corp. which bears no responsibility for
Avid products. All other trademarks are the property of their
respective owners. All announcements of products and enhancements
are made on a when and if available basis.
CONTACT: PR Contact:
Avid
Lisa Kilborn
lisa.kilborn@Avid.com
617.285.2288
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