CompuDyne Corporation Agrees to Be Acquired by Investor Group for $7.00 Per Share in Cash
07 Agosto 2007 - 7:30AM
Business Wire
CompuDyne Corporation (NASDAQ:CDCY), an industry leader in
sophisticated security products, integration and technology for the
public security markets, announced that it has signed a definitive
purchase agreement to be acquired by an investor group consisting
of affiliates of The Gores Group, LLC and industry executive Stuart
Mackiernan. Clearlake Capital Group, L.P. has committed to provide
debt and equity financing to the investor group in the transaction.
CompuDyne�s Board of Directors has agreed to recommend the sale of
the company via a cash tender offer at $7.00 per share followed by
a merger at the same price. An agreement and plan of merger was
executed on August 6, 2007. CompuDyne expects the cash tender offer
to be made to all shareholders during the month of August. The
offer price of $7.00 per share represents a 32% premium to the
closing price of CompuDyne common stock as of August 6, 2007. �This
action represents the culmination of a long process of exploring
the best direction for CompuDyne to take,� said Martin Roenigk,
Chairman & CEO of CompuDyne, �Given our relatively small size,
complex structure, and the inordinate costs of being a public
company in the post-Sarbanes Oxley era, a sale of the entire
company to an organization that has the financial and managerial
resources to continue to build CompuDyne without the managerial
diversion and financial drain of public company requirements seemed
the most appropriate step to take. The $7.00 per share price, which
represents a significant premium over recent public market prices
for our stock, was determined to represent fair value.� Stuart
Mackiernan, an industry executive with significant experience in
the defense and government services industry, will become CEO of
CompuDyne upon closing. �Based upon my experience in the industry,
CompuDyne represents a unique opportunity to create a substantial
player in the public security marketplace,� Mackiernan said. �We
believe that as a private company CompuDyne will be better able to
fully realize its potential in this important market.� Mackiernan
most recently was Corporate Vice President, Business Development,
and President & CEO of L-3 Satellite Networks at L-3
Communications. Prior thereto, Mr. Mackiernan held senior positions
at GE Capital Spacenet Services, General Dynamics, SAIC, and
Unisys. Based in Los Angeles, CA, The Gores Group, LLC is a private
investment firm focused on buyout transactions across several
industry sectors. �CompuDyne is well positioned in a broad range of
public security markets which offer substantial growth opportunity
over the foreseeable future,� said Ian R. Weingarten, Managing
Director at Gores. �We are pleased to be working with Stuart and
the team at CompuDyne, as well as CompuDyne�s customers and
vendors, to create additional value in the business.� Steven Chang,
partner and co-founder at Clearlake Capital, said �CompuDyne has a
strong franchise and is uniquely positioned in key areas within the
homeland security and infrastructure protection markets. We are
excited to partner with Gores and Stuart to invest behind the
Company�s efforts to expand its solutions offering to serve the
global customer base.� USBX Advisory Services LLC acted as
financial advisor to CompuDyne and rendered a fairness opinion.
Ballard Spahr Andrews & Ingersoll, LLP acted as legal advisor
to CompuDyne. Friedman, Billings, Ramsey & Co., Inc. acted as
financial advisor to the investor group. Bingham McCutchen LLP,
Skadden, Arps, Slate, Meagher & Flom�LLP and Alston & Bird
LLP acted as legal advisors to the investor group. About CompuDyne
CompuDyne Corporation is a leading provider of products and
services to the public security market with 2006 revenues of $147.5
million. CompuDyne operates in four distinct segments in this
marketplace: Institutional Security Systems, Attack Protection,
Integrated Electronics and Public Safety and Justice. CompuDyne�s
customers include several divisions of federal, state and local
governmental agencies and corporate clientele. For more
information, please visit www.CompuDyne.com. About The Gores Group
Founded in 1987, The Gores Group, LLC is a private equity firm
focused on acquiring controlling interests in mature and growing
businesses which can benefit from the firm's operating experience
and flexible capital base. The firm combines the operational
expertise and detailed due diligence capabilities of a strategic
buyer with the seasoned M&A team of a traditional financial
buyer. The Gores Group, LLC has become a leading investor having
demonstrated over time a reliable track record of creating
substantial value in its portfolio companies alongside management.
The firm�s current private equity fund has committed equity capital
of $1.3 billion. Headquartered in Los Angeles, California, The
Gores Group, LLC maintains offices in Boulder, Colorado and London.
For more information, please visit www.gores.com. About Clearlake
Capital Group Clearlake Capital Group is a private investment firm
integrating private equity, leveraged finance, and special
situations in both private and public market opportunities.
Clearlake seeks to partner with world-class management teams to
invest in businesses going through change or expansion with patient
long-term capital. The firm has a flexible mandate to invest across
the capital structure in corporate divestitures, recapitalizations,
restructurings, going private buyouts and growth capital
investments. Clearlake's founding principals have led over 30
investments totaling more than $3 billion of capital in sectors
including business services, communications and media, energy and
power, healthcare, manufacturing, retail/consumer and technology.
Forward-Looking Statements Certain statements made in this press
release constitute "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995, including
those statements concerning CompuDyne�s expectations with respect
to future operating results and other events. Although CompuDyne
believes it has a reasonable basis for these forward-looking
statements, these statements involve risks and uncertainties that
cannot be predicted or quantified and consequently, actual results
may differ materially from those expressed or implied by such
forward-looking statements. Factors which could cause actual
results to differ from expectations include, among others, the
occurrence of any event, change or other circumstances that could
give rise to the termination of the merger agreement with the
investor group, the risk that the conditions relating to the
required minimum tender of CompuDyne shares or any required
regulatory clearance might not be satisfied in a timely manner or
at all, the failure to satisfy other conditions to completion of
the merger, risks that the proposed transaction disrupts current
plans and operations and the potential difficulties in key employee
retention as a result of the transaction, capital spending patterns
of the security market and the demand for CompuDyne�s products,
competitive factors and pricing pressures, changes in legislation,
regulatory requirements, government budget problems, CompuDyne�s
ability to secure new contracts, the ability to successfully grow
CompuDyne by completing acquisitions, the ability to remain in
compliance with its bank covenants, delays in government
procurement processes, ability to obtain bid, payment and
performance bonds on various of CompuDyne�s projects, technological
change or difficulties, the ability to refinance debt when it
becomes due, product development risks, commercialization
difficulties, adverse results in litigation, the level of product
returns, the amount of remedial work needed to be performed, costs
of compliance with Sarbanes-Oxley requirements and the impact of
the failure to comply with such requirements, risks associated with
internal control weaknesses identified in complying with Section
404 of Sarbanes-Oxley, CompuDyne�s ability to simplify its
structure and modify its strategic objectives, and general economic
conditions. Risks inherent in CompuDyne�s business and with respect
to future uncertainties are further described in its other filings
with the Securities Exchange Commission, such as CompuDyne�s Form
10-K, Form 10-Q, and Form 8-K reports. IMPORTANT ADDITIONAL
INFORMATION: The tender offer described in this announcement has
not yet been commenced. This announcement and the description
contained herein is neither an offer to purchase nor a solicitation
of an offer to sell shares of CompuDyne. At the time the tender
offer is commenced, Gores Patriot Holdings, Inc., an affiliate of
The Gores Group, LLC, and Patriot Acquisition Corp., a wholly-owned
subsidiary of Gores Patriot Holdings, Inc., intend to file a Tender
Offer Statement on Schedule TO containing an offer to purchase,
forms of letters of transmittal and other documents relating to the
tender offer, and CompuDyne Corporation intends to file a
Solicitation/Recommendation Statement on Schedule 14D-9 with
respect to the tender offer. Gores Patriot Holdings, Inc., its
wholly owned subsidiary, and CompuDyne Corporation intend to mail
these documents to the stockholders of CompuDyne Corporation. These
documents will contain important information about the tender offer
and stockholders of CompuDyne Corporation are urged to read them
carefully when they become available. Investors and stockholders of
CompuDyne Corporation will be able to obtain a free copy of these
documents (when they become available) and other documents filed by
CompuDyne Corporation or Gores Patriot Holdings, Inc. with the SEC
at the website maintained by the SEC at www.sec.gov. The tender
offer statement and related materials may be obtained for free by
directing such requests to MacKenzie Partners Inc., attention Bob
Marese, at (310) 788-2850. In addition, investors and stockholders
may obtain a free copy of the solicitation/recommendation statement
and such other documents (when they become available) from
CompuDyne Corporation by directing requests to CompuDyne
Corporation at 2530 Riva Road, Suite 201, Annapolis, Maryland
21401.
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