BELLEVUE, Wash. and
NEW YORK, July 25, 2016 /PRNewswire/ -- Outerwall Inc.
("Outerwall" or the "Company") (Nasdaq: OUTR) today announced that
it has entered into an Agreement and Plan of Merger (the "Merger
Agreement") with affiliates of certain funds (the "Apollo Funds")
managed by affiliates of Apollo Global Management, LLC (together
with its consolidated subsidiaries, "Apollo") (NYSE: APO), a
leading global alternative investment manager, pursuant to which
the Apollo Funds will acquire all of the outstanding shares of
Outerwall common stock for $52.00 per
share in cash.
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The purchase price represents a premium of approximately 51
percent over Outerwall's closing stock price on March 14, 2016, immediately prior to the
announcement that the Company's Board of Directors initiated a
thorough and comprehensive process to explore strategic and
financial alternatives to maximize shareholder value. The
transaction, which was unanimously approved by Outerwall's Board of
Directors, has a total enterprise value of approximately
$1.6 billion, including net debt.
"Outerwall's Board of Directors has undertaken a comprehensive
review of a wide range of strategic and financial alternatives to
maximize value for all Outerwall shareholders. We are pleased
to reach this agreement, which follows a robust process and
provides an immediate and substantial cash premium to our
shareholders," said Erik E. Prusch,
Outerwall's Chief Executive Officer. "Apollo is an ideal partner to
support Outerwall's efforts to continue serving our millions of
loyal customers and dedicated retail partners through our unrivaled
network of kiosks and automated retail offerings. We look
forward to working closely with Apollo as we continue to strengthen
our businesses and execute on our strategic plan."
"We are extremely excited for our funds to acquire Outerwall,"
said David Sambur, Partner at Apollo. "Outerwall is a dynamic
customer-focused business that delivers superior kiosk experiences
that delight consumers and generate value for its retailer
partners. We look forward to working with Outerwall's talented and
dedicated team to continue the business's strong heritage of growth
and innovation."
Transaction Details
The transaction will be completed
through an all-cash tender offer. The Outerwall Board of Directors
unanimously recommends that Outerwall shareholders tender their
shares in the offer.
The transaction is conditioned upon satisfaction of the minimum
tender condition, which requires that shares representing more than
50 percent of the Company's common shares be tendered and the
receipt of certain regulatory approvals and other customary closing
conditions. The transaction is currently expected to close during
the third quarter of 2016. Following the transaction, Outerwall
will become a privately held company and Outerwall's common shares
will no longer be listed on any public market.
Morgan Stanley & Co. LLC is serving as financial advisor to
Outerwall and Wachtell, Lipton,
Rosen & Katz and Perkins Coie LLP are serving as legal counsel.
LionTree Advisors, Bank of America Merrill Lynch, Barclays, Credit
Suisse and Jefferies LLC are acting as M&A advisors to Apollo
and Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as
legal advisor to Apollo.
Financing is being provided by Bank of America Merrill Lynch,
Jefferies Finance LLC, Barclays and Credit Suisse.
Outerwall plans to release its second quarter earnings after
market close on Thursday, July 28 and
does not intend to hold a conference call to discuss earnings given
the announced sale of the Company.
Dividend
In addition, on July 24, 2016, the
Outerwall Board of Directors declared a quarterly dividend of
$0.60 per share of common stock. The
dividend is expected to be paid on September
6, 2016, to stockholders of record at the close of business
on August 23, 2016.
About Outerwall
Outerwall Inc. (Nasdaq: OUTR) has
more than 20 years of experience creating some of the most
profitable spaces for their retail partners. The company delivers
breakthrough kiosk experiences that delight consumers and generate
revenue for retailers. As the company that brought consumers
Redbox® entertainment, Coinstar® money services, and ecoATM®
electronics recycling kiosks, Outerwall is leading the next
generation of automated retail and paving the way for inventive,
scalable businesses. Outerwall™ kiosks are in neighborhood grocery
stores, drug stores, mass merchants, malls, and other retail
locations in the United States,
Canada, Puerto Rico, the United Kingdom, and Ireland. Learn more at www.outerwall.com.
About Apollo Global Management
Apollo (NYSE: APO) is
a leading global alternative investment manager with offices in
New York, Los Angeles, Houston, Chicago, Bethesda, Toronto, London, Frankfurt, Madrid, Luxembourg, Singapore, Mumbai, Delhi, Shanghai and Hong
Kong. Apollo had assets under management of approximately
$173 billion as of March 31, 2016, in private equity, credit and
real estate funds invested across a core group of nine industries
where Apollo has considerable knowledge and resources. For more
information about Apollo, please visit www.agm.com.
Forward-Looking Statements
This communication contains
forward-looking statements in addition to historical and other
information. Outerwall uses words such as "anticipate," "believe,"
"could," "estimate," "expect," "forecast," "intend," "looking
forward," "may," "plan," "potential," "project," "should,"
"target," "will" and "would," or any variations of these words, or
other words with similar meanings to or that otherwise, identify
forward-looking statements. All statements that address activities,
events, performance or developments that Outerwall intends, expects
or believes may occur in the future are forward-looking statements.
Forward-looking statements may relate to such matters as the tender
offer, its completion and the completion of the related
transactions, and payment of dividends, as well as Outerwall's
industry, business strategy, goals, projections and expectations
concerning Outerwall's market positions, future operations, future
performance, results or condition, margins, profitability, capital
expenditures, liquidity and capital resources, interest rates and
other financial and operating information and the outcome of
contingencies such as legal and administrative proceedings. The
following are some of the factors and uncertainties that could
cause actual future results, performance, condition and events to
differ, including materially, from those expressed in any
forward-looking statements: (1) uncertainties as to the timing of
the proposed transactions relating to the tender offer; (2) the
risk that the proposed transactions, including the tender offer and
related mergers, may not be completed in a timely manner or at all;
(3) uncertainties as to the percentage of Outerwall's stockholders
that will support the proposed transactions and tender their shares
in the tender offer; (4) the possibility that competing offers or
acquisition proposals for Outerwall will be made; (5) the
possibility that any or all of the various conditions to the
consummation of the proposed transactions may not be satisfied or
waived, including the failure to receive any required regulatory
approvals from any applicable governmental entities (or any
conditions, limitations or restrictions placed on such approvals);
(6) the occurrence of any event, change or other circumstance that
could give rise to the termination of the agreement and plan of
merger (such as the occurrence of a material adverse effect),
including in circumstances that would require Outerwall to pay a
termination fee or other expenses; (7) risks regarding the failure
to obtain the necessary financing to complete the proposed
transactions; (8) risks related to the equity and debt financing
and related guarantee arrangements entered into in connection with
the proposed transactions; (9) the effect of the announcement or
pendency of the proposed transactions on Outerwall's ability to
retain and hire key personnel, its ability to maintain
relationships with its customers, retailers, suppliers and others
with whom it does business, and its operating results and business
generally; (10) risks related to diverting management's attention
from Outerwall's ongoing business operations; (11) the risk that
stockholder litigation in connection with the proposed transactions
may result in significant costs of defense, indemnification and
liability; (12) effects of changes in the general business,
political and economic climates; and (13) other factors as set
forth from time to time in Outerwall's filings with the SEC,
including its Form 10-K for the fiscal year ended December 31, 2015, subsequent Form 10-Q filings,
and other SEC filings. These forward-looking statements reflect
Outerwall's expectations as of the date of this communication.
Factors or events that could affect the proposed transactions or
cause actual events, results or performance to differ, including
materially, may emerge from time to time, and it is not possible
for Outerwall to predict all of them. Accordingly, no assurances
can be given as to, among other things, whether the proposed
transactions will be completed or if any of the other events
anticipated by the forward-looking statements will occur or what
impact they will have. Any forward-looking statements made by
Outerwall in this communication speak only as of the date hereof.
Outerwall undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by
applicable securities laws.
Additional Information and Where to Find It
The
tender offer for the outstanding shares of Outerwall referenced in
this press release has not yet commenced. This communication is for
informational purposes only and is neither an offer to purchase nor
a solicitation of an offer to sell shares, nor is it a substitute
for the tender offer materials that Apollo and its acquisition
subsidiary will file with the U.S. Securities and Exchange
Commission (the "SEC") upon commencement of the tender offer.
At the time the tender offer is commenced, Apollo and its
acquisition subsidiary will file tender offer materials on Schedule
TO, and Outerwall thereafter will file a
Solicitation/Recommendation Statement on Schedule 14D-9 with
the SEC with respect to the tender offer. THE TENDER
OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER
OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER DOCUMENTS) AND THE
SOLICITATION/RECOMMENDATION STATEMENT WILL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF SHARES OF OUTERWALL ARE URGED TO READ THESE
DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION THAT HOLDERS OF THE OUTERWALL
SECURITIES SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING
TENDERING THEIR SECURITIES.
The Offer to Purchase, the related Letter of Transmittal and
certain other tender offer documents, as well as the
Solicitation/Recommendation Statement, will be made available to
all holders of shares of Outerwall at no expense to them. The
tender offer materials, the Solicitation/Recommendation Statement
and other related documents (when available) will be made available
for free at the SEC's web site at www.sec.gov.
Investors and securityholders may access copies of the
Solicitation/Recommendation Statement and other related documents
(when available) that Outerwall files with the SEC at
ir.outerwall.com or by contacting the Company's Investor
Relations Department by phone at (425) 943-8242 or by e-mail at
investor.relations@outerwall.com.
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SOURCE Outerwall Inc.