NORTH CANTON, Ohio and
PADERBORN, Germany, Nov. 23, 2015 /PRNewswire/ --
- Companies have entered into a business combination agreement
in which Diebold will launch a voluntary public tender offer for
all of Wincor Nixdorf's outstanding shares
- Brings together leading global innovators in banking and
retail technologies in rapidly transforming industries
- Combined company will deliver fully integrated and
transformative solutions in value-added services, branch automation
and omnichannel experiences
- Both companies share a common strategic focus on growing
services and software, and have highly complementary offerings,
geographic presence and customer bases
- Diebold will offer Wincor Nixdorf shareholders €38.98 in
cash plus 0.434 Diebold common shares per Wincor Nixdorf
share1
- Transaction values Wincor Nixdorf, including net debt, at
approximately $1.8 billion, or €1.7
billion2
- Transaction expected to yield approximately $160 million of annual cost synergies, and the
combined company will target non-GAAP operating margin3
in excess of 9 percent by the end of the third full year following
completion of the transaction
Diebold, Incorporated (NYSE:DBD), a global leader in providing
self-service delivery, value-added services and software primarily
to the financial industry, and Wincor Nixdorf AG (FWB: WIN), a
leading provider of IT solutions and services to banks and the
retail industry, today announced that the companies have entered
into a business combination agreement. Pursuant to the business
combination agreement, Diebold will launch a voluntary public
tender offer to all shareholders of Wincor Nixdorf. Under the
terms of the agreement, Diebold will offer Wincor Nixdorf
shareholders €38.98 in cash plus 0.434 Diebold common shares per
Wincor Nixdorf share1. This transaction values Wincor
Nixdorf, including net debt, at approximately $1.8 billion, or €1.7 billion2.
The combined company had pro forma revenue of approximately
$5.2 billion, or €4.8
billion4, for the trailing 12 months ended Sept. 30, 2015, excluding revenue attributable to
Diebold's North America electronic
security business, which it recently agreed to divest. Following
completion of the offer and subject to certain approvals, the
combined company will be named Diebold
Nixdorf, with common shares publicly listed on the New York
Stock Exchange and the Frankfurt Stock Exchange. The combined
company will have registered offices in North Canton, Ohio, U.S. and will be operated
from headquarters in North Canton
and Paderborn, Germany.
The combination brings together leading innovators in
value-added services, branch automation and omnichannel experiences
to create an industry leader focused on the entire value chain --
consult, design, build and operate -- to help financial
institutions and retailers succeed in their business transformation
journey. The combined company will build upon the two companies'
shared vision that services and software drive the consumer
experience and enable customers to differentiate themselves in an
evolving industry. The combined company will pursue a growing total
addressable market of approximately $60
billion, according to independent market estimates and
Diebold internal analysis.
Combined Company to Deliver More Services and Innovation to
the Market
"The rate of change we see in our industry is unprecedented, and
by leveraging innovative solutions and talent from both
organizations we will have the scale, strength and flexibility to
help our customers through their own business transformation," said
Andy W. Mattes, Diebold president
and chief executive officer (CEO). "Our new company will be well
positioned for growth in high-value services and software --
particularly in the areas of managed services, branch automation,
mobile and omnichannel solutions -- across a broader customer base.
This combination was made possible through the successes we have
had and continue to create in the Diebold 2.0 transformation plan.
We have a history of collaboration with Wincor Nixdorf, and our
shared approach will help drive a successful integration and
minimize disruption. I am very excited about the many opportunities
we will create together."
"The combination of Diebold and Wincor Nixdorf is an exciting
opportunity for both companies to shape the future of banking and
retail solutions. Together, we can even better leverage the
potential of a rapidly changing banking and retail market due to
our strong combined R&D expertise. With our complementary
geographic presence, we will be even closer to customers worldwide.
Our common view of omnichannel software solutions will enable us to
create a best-in-class customer experience to support banks and
retailers to cope with challenges of digitalization," said
Eckard Heidloff, CEO, Wincor
Nixdorf. "Furthermore, we are convinced that our employees will
benefit from being part of an even stronger, more global
organization that is well positioned for the age of
digitalization."
Highly Complementary Geographies, Customers and
Solutions
The two companies share a complementary geographic reach across
the Americas, EMEA and within Asia, along with strong, trusted brands backed
by best-in-breed engineering. Diebold is a leading player in the
Americas, whereas Wincor Nixdorf is a leading player in
Europe. These two regions are also
key drivers for innovation and digital transformation -- both in
banking and retail.
The combined company's collective capabilities and established
global market presence will offer a broader range of services and
solutions across its customer base. Growth in both the software and
services segments is expected to be accelerated by the combined,
expanded installed base of nearly one million automated teller
machines (ATMs) worldwide to the benefit of the customers. The
combined company's strong service presence will also benefit Wincor
Nixdorf's retail business.
Agreement Approved by Boards of Both Companies
Under the terms of the business combination agreement, which has
been approved by Diebold's board of directors and Wincor Nixdorf's
supervisory board, Diebold will launch a voluntary public tender
offer for all outstanding shares of Wincor Nixdorf. The offer
consideration will consist of €38.98 in cash plus 0.434 Diebold
shares per Wincor Nixdorf share.
Based on the volume-weighted average share price of Diebold
shares over the last five trading days prior to Oct. 17, 2015, the day on which the companies
confirmed entry into a non-binding term sheet for a proposed
business combination, the total offer consideration represented an
implied value of €52.50 per Wincor Nixdorf share. This implied
value represents a premium of approximately 35 percent over Wincor
Nixdorf's closing share price as of Oct. 16,
2015, and a premium of approximately 42 percent over the
volume-weighted average price per share over the last three months
preceding that date. The corresponding enterprise value
including net debt amounts to approximately $1.8 billion, or €1.7 billion, under these
terms.
Under the business combination agreement, the existing
transformation program at Wincor Nixdorf will be supported by
Diebold and will proceed as planned. The parties have agreed that
there will be no material workforce reductions in Germany beyond this existing program as a
result of the transaction. Furthermore, all labor-related laws and
regulations will be respected and co-determination on the German
supervisory board level shall remain unchanged.
Following the completion of the transaction, the combined
company plans to deliver approximately $160
million of annual cost synergies and will target a non-GAAP
operating margin in excess of 9 percent by the end of the third
full year. In addition, the transaction is expected to be accretive
to non-GAAP earnings per share5 in the second year,
excluding integration costs.
The terms of the voluntary public tender offer were subject to
thorough analysis by Wincor Nixdorf's supervisory board and
management board as required by their fiduciary duties. The
management board and supervisory board of Wincor Nixdorf consider
the offer consideration proposed by Diebold fair for shareholders
and the overall agreement in the best interest of Wincor Nixdorf,
its shareholders, employees and other stakeholders and therefore
intend to recommend the offer.
Equal Representation on the Executive Committee
Diebold's Mattes, 54, will be CEO of the combined company.
Wincor Nixdorf's Heidloff, 59, will be president.
Christopher C. Chapman, 41, the
current Diebold chief financial officer (CFO), will serve as CFO of
the combined company, and Jurgen Wunram, 57, Wincor Nixdorf CFO,
will serve as chief integration officer and will represent the
retail business in the executive committee. In total, the combined
company's executive committee of eight will be equally represented
by business leaders from both Diebold and Wincor Nixdorf, including
the four executives mentioned above.
Following the closing it is anticipated that along with the
existing Diebold board members, three new directors will join the
board of the combined company: Dr. Alexander Dibelius, chairman of the supervisory
board of Wincor Nixdorf, Dr. Dieter
Dusedau, member of the supervisory board of Wincor Nixdorf,
and Eckard Heidloff. Also, to
facilitate the integration, it is intended that three Diebold
executives will join the supervisory board of Wincor Nixdorf upon
closing.
Transaction Structure
The transaction will be implemented through a voluntary public
tender offer for all outstanding shares of Wincor Nixdorf. Diebold
expects the offer to commence during the first quarter of 2016
after filing of Diebold's registration statement on Form S-4 with
the U.S. Securities and Exchange Commission and approval of the
offer document by the German Federal Financial Supervisory
Authority (Bundesanstalt fuer Finanzdienstleistungsaufsicht /
BaFin). The offer is subject to certain closing conditions,
including regulatory approvals and a minimum acceptance threshold
of c. 67.6 percent of all existing Wincor Nixdorf ordinary shares
(this corresponds, after deduction of treasury shares held by
Wincor Nixdorf which will not be tendered, to c. 75 percent of all
current voting stock (outstanding shares)).
Given that the mixed consideration consisting of cash and stock
is offered by a US corporation, Diebold, Inc. does not expect that
German withholding tax will apply to Wincor Nixdorf shareholders
who are not tax-resident in Germany (unless the Wincor Nixdorf shares are
held as part of business assets in Germany). For Wincor Nixdorf
shareholders tax resident in Germany, the tax treatment of the voluntary
public tender offer will follow generally applicable German tax
principles, which may include German taxation of the cash component
of the consideration as a dividend for certain shareholders
tax-resident in Germany. A general summary of material tax
consequences related to the participation in the voluntary public
tender offer will be published as part of the offer
documentation. For an individual analysis of their personal
tax situation in connection with the acceptance of the voluntary
public takeover offer, Wincor Nixdorf shareholders are advised to
consult their tax advisors.
Upon successful completion of the offer and regulatory
approvals, Diebold will consolidate the financial results of Wincor
Nixdorf, and Diebold's earnings will reflect its proportionate
share of Wincor Nixdorf's earnings.
Financing the Transaction
Diebold has committed financing in place. In addition to cash on
hand, Diebold expects to raise approximately $2.8 billion to fund the transaction, refinance
existing debt of both companies and provide liquidity. This
permanent financing is expected to be comprised of a $0.5 billion senior secured revolver and
$2.3 billion of senior secured term
loans and unsecured notes.
Following the transaction close, the pro forma balance sheet is
expected to have net debt/EBITDA6 of approximately 4x.
The combined company intends to shift its capital allocation plans
to focus on deleveraging the balance sheet to be consistently below
3x net debt/EBITDA by the end of year three. Commensurate with this
approach and after the transaction closes, the combined company
intends to pay a dividend per share at a rate of approximately
one-third of Diebold's current annual cash dividend per share,
subject to market and other conditions. Moving forward,
paying a dividend remains a part of the combined company's
philosophy of returning value to shareholders.
Credit Suisse and J.P. Morgan acted as financial advisers to
Diebold, along with Sullivan & Cromwell LLP, who served as
legal adviser. J.P. Morgan and Credit Suisse are also providing
committed financing for the transaction. Goldman Sachs acted as
financial adviser to Wincor Nixdorf, along with Freshfields
Bruckhaus Deringer LLP, who served as legal adviser.
Details for Joint Press Call
The companies will jointly present their plans for the business
combination on a media call taking place today at 10:00 a.m. CET (4:00 a.m.
EST). The media call will take place in German. Participants
should ask to join the "Diebold and Wincor Nixdorf Media Call".
Details on the call are as follows:
Germany Toll free: 0800 673 7932
US/CAN Toll free: 1 866 966 5335
UK Toll free: 0808 109 0700
Int'l Toll: +44 (0) 20 3003 2666
Diebold Analyst Call Details
Diebold will hold an analyst conference call to present this
business combination during a webcast and conference call today at
8:00 a.m. EST (2:00 p.m. CET). Both the presentation and access
to the call are available via Diebold's website at
http://www.diebold.com/DieboldWincor. A replay of the call will
also be available on this website. The conference call will last
approximately one hour. Participants should plan to dial in 10
minutes prior to the session. Details on the call are as
follows:
US/CAN Toll free: 1 877 545 1403
Int'l Toll: +1 719 325 4893
Conference ID: 6742172
Wincor Nixdorf Analyst Call Details
Wincor Nixdorf will hold an analyst conference call to present
this business combination today at 11:30
a.m. EST (5:30 p.m. CET). The dial-in number is as
follows:
Int'l Toll: +49-(0) 69-271340171
Diebold
Contacts
|
Media
Relations
Mike Jacobsen,
APR
+1 330 490
3796
michael.jacobsen@diebold.com
Felix Morlock,
Brunswick Group (Germany)
+49 69 2400
5510
fmorlock@brunswickgroup.com
Cindy Leggett-Flynn,
Brunswick Group (U.S.)
+1 212 333
3810
clf@brunswickgroup.com
|
Investor
Relations
Steve
Virostek
+1 330 490
6319
stephen.virostek@diebold.com
|
Wincor Nixdorf
Contacts
|
Media
Relations
Andreas
Bruck
+49 5251 693
5200
andreas.bruck@wincor-nixdorf.com
|
Investor
Relations
Dr. Sabine
Brummel
+49 5251 693
5050
sabine.brummel@wincor-nixdorf.com
|
About Diebold
Diebold, Incorporated (NYSE: DBD) provides the technology,
software and services that connect people around the world with
their money - bridging the physical and digital worlds of cash
conveniently, securely and efficiently. Since its founding in 1859,
Diebold has evolved to become a leading provider of exceptional
self-service innovation, security and services to financial,
commercial, retail and other markets.
Diebold has approximately 16,000 employees worldwide and is
headquartered near Canton, Ohio,
USA. Visit Diebold at www.diebold.com or on Twitter:
http://twitter.com/DieboldInc.
About Wincor Nixdorf
Wincor Nixdorf is one of the world's leading providers of IT
solutions and services to retail banks and the retail industry. The
main focus of the group's comprehensive portfolio lies on business
process optimization, especially in the branch operations of both
sectors. Wincor Nixdorf has established a presence in around 130
countries around the globe, giving it an outstanding profile when
it comes to customer proximity. The parent company has subsidiaries
in 42 countries. The company also places great importance on
building close relationships with sales partners that have an
excellent knowledge of the local requirements and conditions on the
customer side. Wincor Nixdorf has a total workforce of around 9,000
people. Over half of those are based outside Germany.
NOTES
1 Calculated using fixed exchange
ratio and five-day volume weighted average price of Diebold shares
prior to Oct. 17, 2015 announcement
that both companies had signed a non-binding term sheet regarding a
potential business combination. Diebold's five-day volume weighted
average price was converted to euros using an exchange rate of
1.07 U.S. dollars to the euro.
Shareholders of Wincor Nixdorf are advised to consult their tax
advisors regarding the tax consequences in connection with the
acceptance of the voluntary public tender offer.
2 The exchange rate used to calculate total
consideration and transaction value was 1.07
U.S. dollars to the euro.
3 Non-GAAP operating margin is the percentage of GAAP
operating profit margin adjusted for restructuring and non-routine
items.
4 Diebold prepares its financial statements in
accordance with US GAAP while Wincor Nixdorf prepares its financial
statements in accordance with IFRS. Revenues are derived from the
combined revenues of both companies for the trailing 12 months,
before making adjustments to convert Wincor Nixdorf's financial
results from IFRS to US GAAP. Wincor Nixdorf revenue has been
converted at an exchange rate of 1.09 U.S.
dollars to the euro.
5 Non-GAAP earnings per share is GAAP earnings adjusted
for restructuring and non-routine items compared to the combined
company's outstanding shares.
6 Net debt/EBITDA is defined as long-term debt plus
short-term debt minus cash and cash equivalents divided by earnings
before interest, taxes, depreciation and amortization adjusted for
restructuring and other non-recurring items for the trailing 12
months. This ratio assumes that the North American Electronic
Security business has been divested.
IMPORTANT INFORMATION FOR INVESTORS AND
SHAREHOLDERS
In connection with the proposed business
combination transaction, Diebold intends to file a Registration
Statement on Form S-4 with the U.S. Securities and Exchange
Commission ("SEC") that will include a prospectus of Diebold to be
used in connection with the offer by Diebold to acquire all
outstanding Wincor Nixdorf shares. When available, Diebold will
disseminate the prospectus to Wincor Nixdorf shareholders in
connection with Diebold's offer to acquire all of the outstanding
shares of Wincor Nixdorf. Diebold also intends to file an offer
document with the German Federal Financial Supervisory Authority
(Bundesanstalt fuer Finanzdienstleistungsaufsicht)
("BaFin").
INVESTORS AND SHAREHOLDERS ARE URGED TO READ THE PROSPECTUS
AND THE OFFER DOCUMENT, AS WELL AS OTHER DOCUMENTS THAT WILL BE
FILED WITH THE SEC OR BAFIN OR PUBLISHED AT DIEBOLD'S WEBSITE AT
WWW.DIEBOLD.COM UNDER THE INVESTOR RELATIONS SECTION, REGARDING THE
PROPOSED BUSINESS COMBINATION TRANSACTION AND THE OFFER BECAUSE
THESE DOCUMENTS WILL CONTAIN IMPORTANT INFORMATION.
You will be able to obtain a free copy of the prospectus and
other related documents filed by Diebold with the SEC on the SEC's
website at www.sec.gov. The prospectus and other documents relating
thereto may also be obtained for free by accessing Diebold's
website at www.diebold.com under the Investor Relations section.
Following approval by BaFin, you may obtain a free copy of the
offer document on BaFin's website at www.bafin.de, and, along
with an English translation thereof, at Diebold's website at
www.diebold.com under the Investor Relations section. Further you
may obtain a copy of the offer document from Deutsche Bank
Aktiengesellschaft, Taunusanlage 12, 60325 Frankfurt am Main,
Germany, for distribution free of
charge (also available from Deutsche Bank Aktiengesellschaft via
e-mail to dct.tender‑offers@db.com or by telefax to
+49 69 910 38794). In addition an English language
press release and its German language translation will be published
via an electronically operated information distribution system in
the United States.
This document is neither an offer to purchase nor a solicitation
of an offer to sell shares of Wincor Nixdorf or Diebold. Final
terms and further provisions regarding the public offer will be
disclosed in the offer document after the publication has been
approved by BaFin and in documents that will be filed with the SEC.
Investors and holders of Wincor Nixdorf shares, or of such
instruments conferring a right to directly or indirectly acquire
Wincor Nixdorf shares, are strongly encouraged to read the offer
document and all documents in connection with the public offer as
soon as they are published because these documents will contain
important information.
No offering of securities will be made except by means of a
prospectus meeting the requirements of Section 10 of the U.S.
Securities Act of 1933, as amended, and applicable European
regulations, including the German Securities Acquisition and
Takeover Act (Wertpapiererwerbs- und Übernahmegesetz) and the
German Securities Prospectus Act (Wertpapierprospektgesetz).
Subject to certain exceptions to be approved by the relevant
regulators or certain facts to be ascertained, the public offer
would not be made directly or indirectly, in or into any
jurisdiction where to do so would constitute a violation of the
laws of such jurisdiction, or by use of the mails or by any means
or instrumentality (including without limitation, facsimile
transmission, telephone and the internet) of interstate or foreign
commerce, or any facility of a national securities exchange, of any
such jurisdiction.
CAUTIONARY STATEMENT ABOUT FORWARD LOOKING
STATEMENTS
Certain statements contained in this
communication regarding matters that are not historical facts are
forward-looking statements (as defined in the Private Securities
Litigation Reform Act of 1995). These include statements regarding
management's intentions, plans, beliefs, expectations or forecasts
for the future including, without limitation, the proposed business
combination with Wincor Nixdorf and the offer. Such forward-looking
statements are based on the current expectations of Diebold and
involve risks and uncertainties; consequently, actual results may
differ materially from those expressed or implied in the
statements. Such forward-looking statements may include statements
about the business combination and the offer, the likelihood that
such transaction is consummated and the effects of any transaction
on the businesses and financial conditions of Diebold or Wincor
Nixdorf, including synergies, pro forma revenue, targeted operating
margin, net debt to EBITDA ratios, accretion to earnings and other
financial or operating measures. By their nature, forward-looking
statements involve risks and uncertainties because they relate to
events and depend on circumstances that may or may not occur in the
future. Forward-looking statements are not guarantees of future
performance and actual results of operations, financial condition
and liquidity, and the development of the industries in which
Diebold and Wincor Nixdorf operate may differ materially from those
made in or suggested by the forward-looking statements contained in
this document. In addition, risks and uncertainties related to the
contemplated business combination between Diebold and Wincor
Nixdorf include, but are not limited to, the expected timing and
likelihood of the completion of the contemplated business
combination, including the timing, receipt and terms and conditions
of any required governmental and regulatory approvals of the
contemplated business combination that could reduce anticipated
benefits or cause the parties not to consummate, or to abandon the
transaction, the ability to successfully integrate the businesses,
the occurrence of any event, change or other circumstances that
could give rise to the termination of the business combination
agreement or the contemplated offer, the risk that the parties may
not be willing or able to satisfy the conditions to the
contemplated business combination or the contemplated offer in a
timely manner or at all, risks related to disruption of management
time from ongoing business operations due to the contemplated
business combination, the risk that any announcements relating to
the contemplated business combination could have adverse effects on
the market price of Diebold's common shares, and the risk that the
contemplated transaction or the potential announcement of such
transaction could have an adverse effect on the ability of Diebold
to retain and hire key personnel and maintain relationships with
its suppliers, and on its operating results and businesses
generally. These risks, as well as other risks associated with the
contemplated business combination, are more fully discussed in a
prospectus that will be included in the Registration Statement on
Form S-4 that will be filed with the SEC in connection with the
contemplated business combination and the offer. Additional risks
and uncertainties are identified and discussed in Diebold's reports
filed with the SEC and available at the SEC's website at
www.sec.gov. Any forward‑looking statements speak only as at the
date of this document. Except as required by applicable law,
neither Diebold nor Wincor Nixdorf undertakes any obligation to
update or revise publicly any forward-looking statement, whether as
a result of new information, future events or otherwise.
This communication outlines certain key German tax principles
related to the participation in the voluntary public tender offer
that may be or may become relevant to holders of shares of Wincor
Nixdorf. The discussion of German tax considerations is of a
general nature only and does not constitute a comprehensive or
definitive explanation of all possible aspects of German taxation
that may be relevant for shareholders of Wincor Nixdorf.
Furthermore, this communication does not address non-German tax
considerations that may apply to a shareholder that is a tax
resident of a jurisdiction other than Germany. This press
release is based upon domestic German tax laws in effect as of the
date hereof. It is important to note that the legal situation
may change, possibly with retroactive effect, and that no assurance
can be given regarding the tax treatment of this transaction by
fiscal authorities and the courts.
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