TIDMEDA
RNS Number : 7500X
Endace Limited
13 February 2013
EMULEX REPORTS ACCEPTANCES OF 88 PERCENT OF ENDACE SHARES
Offer Declared Unconditional as to Level of Acceptances,
and Extended by 14 Days to February 26, 2013
COSTA MESA, Calif. and SUNNYVALE, Calif., February 12, 2013 -
Emulex Corporation (NYSE:ELX), the leading provider of converged
networking solutions, and Endace Limited (LSE:EDA), a leading
supplier of network visibility infrastructure products, announced
today that acceptances have been received for 88 percent of the
shares in Endace. Emulex has declared the Offer unconditional as to
the level of acceptances, and has made an extension of the offer
period by 14 days, to 1 p.m. London time on February 26, 2013 for
the remaining shareholders to submit their shares to accept the
Offer. Emulex will not further extend the offer period without
declaring the Offer wholly unconditional.
"With this announcement, we have taken one more significant step
toward the completion of the acquisition of Endace, and we look
forward to welcoming the Endace team and obtaining complete
ownership of Endace," said Jim McCluney, chief executive officer
(CEO) of Emulex. "The acquisition of Endace doubles our total
addressable market and places Emulex in another high-margin,
high-growth market, enhancing our ability to deliver
industry-leading solutions to connect, monitor and manage
high-performance networks."
Mike Riley, CEO of Endace, said, "We look forward to joining the
Emulex team and moving forward with the next step in our strategy
to become the market leader in network visibility solutions. The
combined capabilities and technical depth of Emulex and Endace will
enable us to deliver true end-to-end network management, expand our
global reach and better support our customers."
By declaring the Offer unconditional as to the level of
acceptances, Emulex has waived the minimum acceptance condition,
which had been stated in the Offer to be holding or controlling 90
percent or more of the voting rights in Endace.
Emulex has made no commitment to purchase outstanding shares of
Endace after February 26, 2013, unless Emulex reaches ownership of
90 percent of the Endace shares, in which case the New Zealand
Takeovers Code (NZTC) includes a requirement for Emulex to provide
an acquisition notice stating either (a) that remaining Endace
shares must be sold to Emulex; or (b) that remaining Endace
shareholders may sell their remaining Endace shares to Emulex. The
88.4 percent of shares received by February 12, 2013 will be paid,
should the Offer be completed, at the offer price of GBP 5.00 per
share, for a total of GBP 67,306,715, which is equal to USD
106,084,726 at the current exchange rate of GBP 0.634 per USD. All
of the Endace employee stock options will be purchased, should the
Offer be completed, for GBP 4,542,429, which is equal to USD
7,159,498 at the current exchange rate. If the remaining11.6
percent of the Endace shares are submitted by the February 26, 2013
offer period end date, then an additional payment of GBP 8,793,625
will be made should the Offer be completed, which is equal to USD
13,859,974 at the current exchange rate.
The Offer was made pursuant to the NZTC, since Endace is a New
Zealand company. The applicable NZTC rule allows, since Emulex
declared the Offer unconditional as to the level of acceptances,
that Emulex provide a further extension notice before the end of
the offer period which had been set for 1 p.m. London time on
February 12, 2013. The offer period has been varied to be until 1
p.m. London time on February 26, 2013. The applicable NZTC rule
provides that the Offer must remain open for at least 14 days after
a variation notice has been sent, and the Offer will not be
extended beyond this date.
A copy of Emulex's Offer, Endace's response (including the
Endace Board recommendation), and the Independent Adviser's report
prepared by Grant Samuel for Endace was sent to Endace shareholders
and optionholders. Copies of those documents are available from the
Endace web site (www.endace.com), and from the Emulex web site
(www.emulex.com) through the Emulex Form 8-K filed on December 21,
2012.
The Grant Samuel report concludes that if the listing of Endace
shares on the AIM is cancelled then "this will make trading of the
remaining Endace shares very difficult...[t]he closer the Emulex
shareholding gets to 90% the lower the liquidity of Endace shares
will be" (page 29). The Grant Samuel report states that "Emulex
cannot acquire any further shares in Endace for a period of twelve
months [after the offer period expires] without making another
formal takeover Offer for all or some of the remaining shares in
[Endace], or without shareholder approval. However, from twelve
months after the Emulex Offer closes, Emulex will be able to
utilise the 'creep' provisions of the Takeovers Code to purchase up
to a further 5% of Endace per annum." (page 30). However, Emulex
has made no commitment to purchase any additional Endace shares
after February 26, 2013.
For further information, please contact:
Emulex Investor Contact: Endace Press/Investor Contact:
Frank Yoshino Tim Nichols
Vice President, Finance Vice President, Corporate Marketing
+1 714 885-3697 +1 408 220-6149
frank.yoshino@emulex.com tim.nichols@endace.com
Emulex Press Contact: Panmure Gordon, UK:
Katherine Lane Hugh Morgan / Giles Stewart / Hannah
Director, Corporate Communications Woodley
+1 714 885-3828 +44 20 78 86 25 00
katherine.lane@emulex.com
About Emulex
Emulex, the leader in converged networking solutions, provides
enterprise-class connectivity for servers, networks and storage
devices within the data center. The Company's product portfolio of
Fibre Channel Host Bus Adapters, 10Gb Ethernet Network Interface
Cards, Ethernet-based Converged Network Adapters, controllers,
embedded bridges and switches, and connectivity management software
are proven, tested and trusted by the world's largest and most
demanding IT environments. Emulex solutions are used and offered by
the industry's leading server and storage OEMs including, Cisco,
Dell, EMC, Fujitsu, Hitachi, Hitachi Data Systems, HP, Huawei, IBM,
NEC, NetApp and Oracle. Emulex is headquartered in Costa Mesa,
Calif. and has offices and research facilities in North America,
Asia and Europe. More information about Emulex (NYSE:ELX) is
available at www.Emulex.com.
About Endace
Endace provides world-leading network visibility infrastructure,
which is trusted by some of the world's largest organizations to
accelerate their response to network and security problems.
Endace Intelligent Network Recorders guarantee to capture, index
and record 100-percent of network traffic while scaling from 1 Gbps
to 100 Gbps. EndaceVision is Endace's proprietary web-based
application that enables engineers to visualize, search and
retrieve network traffic from any Endace Recorder anywhere across
the network.
Endace's marketing headquarters are in Sunnyvale, California.
R&D is in Auckland, New Zealand. Sales offices across the US,
in Reading, UK and Sydney, Australia provide support for
customers.
Quoted on London's AIM, the stock code is LSE: EDA.L
- - - - - - - - -
"Safe Harbor" Statement
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995: With the exception of historical information,
the statements set forth above, including, without limitation,
those relating to the proposed acquisition of Endace, contain
forward-looking statements that involve risk and uncertainties. We
expressly disclaim any obligation or undertaking to release
publicly any updates or changes to these forward-looking statements
that may be made to reflect any future events or circumstances. We
wish to caution readers that a number of important factors could
cause actual results to differ materially from those in the
forward-looking statements. These factors include the possibility
that the pending acquisition of Endace Limited (Endace) is not
completed on a timely basis or at all, the effects of the pending
acquisition of Endace, including our ability to realize the
anticipated benefits of the potential acquisition of Endace on a
timely basis or at all, and our ability to integrate the
technology, operations and personnel of Endace into our existing
operations in a timely and efficient manner. In addition,
intellectual property claims, with or without merit, that could
result in costly litigation, cause product shipment delays, require
us to indemnify customers, or require us to enter into royalty or
licensing agreements, which may or may not be available.
Furthermore, we have in the past obtained, and may be required in
the future to obtain, licenses of technology owned by other
parties. We cannot be certain that the necessary licenses will be
available or that they can be obtained on commercially reasonable
terms. If we were to fail to obtain such royalty or licensing
agreements in a timely manner and on reasonable terms, our
business, results of operations and financial condition could be
materially adversely affected. Ongoing lawsuits, such as the action
brought by Broadcom Corporation (Broadcom), present inherent risks,
any of which could have a material adverse effect on our business,
financial condition, or results of operations. Such potential risks
include continuing expenses of litigation, risk of loss of patent
rights, risk of monetary damages, risk of injunction against the
sale of products incorporating the technology in question,
counterclaims, attorneys' fees, incremental costs associated with
product or component redesigns, and diversion of management's
attention from other business matters. With respect to the
continuing Broadcom litigation, such potential risks also include
the adequacy of any sunset period to make design changes, the
ability to implement any design changes, the availability of
customer resources to complete any
re-qualification or re-testing that may be needed, the ability
to maintain favorable working relationships with Emulex suppliers
of serializer/deserializer (SerDes) modules, and the ability to
obtain a settlement which does not put us at a competitive
disadvantage. In addition, the fact that the economy generally, and
the technology and storage market segments specifically, have been
in a state of uncertainty makes it difficult to determine if past
experience is a good guide to the future and makes it impossible to
determine if markets will grow or shrink in the short term.
Continued weakness in domestic and worldwide macro-economic
conditions and disruptions in world credit and equity markets and
the resulting economic uncertainty for our customers, as well as
the storage and converged networking market as a whole, has and
could continue to adversely affect our revenues and results of
operations. As a result of these uncertainties, we are unable to
predict our future results with any accuracy. Other factors
affecting these forward-looking statements include but are not
limited to the following: faster than anticipated declines in the
storage networking market, slower than expected growth of the
converged networking market or the failure of our Original
Equipment Manufacturer (OEM) customers to successfully incorporate
our products into their systems; our dependence on a limited number
of customers and the effects of the loss of, decrease in or delays
of orders by any such customers, or the failure of such customers
to make timely payments; the emergence of new or stronger
competitors as a result of consolidation movements in the market;
the timing and market acceptance of our products or our OEM
customers' new or enhanced products; costs associated with entry
into new areas of the server and storage technology markets; the
variability in the level of our backlog and the variable and
seasonal procurement patterns of our customers; any inadequacy of
our intellectual property protection and the costs of actual or
potential third-party claims of infringement and any related
indemnity obligations or adverse judgments; the effect of any
actual or potential unsolicited offers to acquire us; proxy fights
or the actions of activist stockholders; impairment charges,
including but not limited to goodwill and intangible assets;
changes in tax rates or legislation; the effects of acquisitions;
the effects of terrorist activities, natural disasters, and any
resulting disruption in our supply chain or customer purchasing
patterns or any other resulting economic or political instability;
the highly competitive nature of the markets for our products as
well as pricing pressures that may result from such competitive
conditions; the effects of changes in our business model to
separately charge for software; the effect of rapid migration of
customers towards newer, lower cost product platforms; possible
transitions from board or box level to application specific
integrated circuit (ASIC) solutions for selected applications; a
shift in unit product mix from higher-end to lower-end or mezzanine
card products; a faster than anticipated decrease in the average
unit selling prices or an increase in the manufactured cost of our
products; delays in product development; our reliance on
third-party suppliers and subcontractors for components and
assembly; our ability to attract and retain key technical
personnel; our ability to benefit from our research and development
activities; our dependence on international sales and
internationally produced products; changes in accounting standards;
and any resulting regulatory changes on our business. These and
other factors could cause actual results to differ materially from
those in the forward-looking statements and are discussed in our
filings with the Securities and Exchange Commission, including our
recent filings on Forms 10-K and 10-Q, under the caption "Risk
Factors."
--------------------
This news release refers to various products and companies by
their trade names. In most, if not all, cases these designations
are claimed as trademarks or registered trademarks by their
respective companies.
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The company news service from the London Stock Exchange
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