AUTONOMY CORPORATION PLC ANNOUNCES AGREEMENT TO ACQUIRE INTERWOVEN, INC. FOR AN AGGREGATE CONSIDERATION OF APPROX. US$775 MILLION
Combination of Autonomy and Interwoven Extends Meaning Based Computing to New Customer Base Enabling World's First Comprehensive Manage-In-Place Architecture
A teleconference call to discuss the transaction will be hosted at 9:00 a.m. GMT on January 22, 2009. The call will be available live via webcast over the World Wide Web. To access the live webcast, investors are directed towards the investor relations section of Autonomy's website, http://www.autonomy.com/. Investors should go to the website approximately 15 minutes prior to the start time of the call to register.
CAMBRIDGE, ENGLAND - January 22, 2009 - Autonomy Corporation plc (LSE: AU. or AU.L), a global leader in infrastructure software, and Interwoven, Inc. (NASDAQ: IWOV), a global leader in content management software, today announced that they have entered into a definitive agreement under which Autonomy will acquire Interwoven. The combination of the two companies will redefine how global 2000 corporations, leading law firms and government regulators will discover, analyze and manage information and interactions.
Interwoven Company Highlights:
Commenting on the Acquisition, Dr. Mike Lynch, Group CEO of Autonomy, said: "The combination of Autonomy and Interwoven, industry leaders in Meaning Based Computing and document and content management respectively, will continue the extension of Autonomy's IDOL as a key element of the regulatory, legal and compliance industries. Our past acquisitions have clearly demonstrated how Autonomy can quickly and effectively leverage the power of IDOL into new customer bases and to address new customer needs. We are very familiar with Interwoven, its product base and management team through our partnership and joint customers over the years and see this transaction as an exciting opportunity to extend the chain of Autonomy's solutions."
"Interwoven and Autonomy are two high-performing companies that share the same vision improving the way organizations understand and interact with information," said Joe Cowan, Interwoven's CEO. "We believe customers will benefit from the combination of Autonomy's industry-leading technology with Interwoven's unmatched position in our target markets. We are extremely excited with the unique possibilities for future product direction that will arise through the integration with Autonomy's IDOL technology."
Deutsche Bank and Morgan Stanley & Co Limited are acting as financial advisors and, in accordance with Chapter 8 of the Listing Rules, sponsors to Autonomy in relation to the acquisition. Citi is a corporate broker to Autonomy.
This summary should be read in conjunction with the full text of the announcement.
|Autonomy Financial Media Contacts:||Autonomy Analyst and Investor Contacts:|
+44 (0)20 7831 3113
Sushovan Hussain, Chief Financial Officer
Autonomy Corporation plc
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Appendix I contains a summary of the Acquisition Agreement.
Appendix II contains the definitions of certain terms used in this summary and the full announcement.
Under the terms of the Acquisition Agreement, Interwoven stockholders will receive $16.20 in cash for each outstanding Interwoven share, representing aggregate consideration of approximately $775 million (assuming exercise of all vested in-the-money Interwoven share options). The consideration will be funded through the proceeds of an underwritten placing of ordinary shares, a new revolving credit facility of up to $200 million and Interwoven and Autonomy's existing cash resources. The Acquisition is conditional upon, inter alia: (i) approval by Interwoven shareholders; (ii) approval by Autonomy shareholders at an Extraordinary General Meeting, notice of which will be sent to Autonomy shareholders in due course; and (iii) regulatory approvals and antitrust approvals. The terms of the Acquisition have been unanimously approved by the Boards of Directors of both companies. Interwoven has agreed to pay a break-up fee to Autonomy of $25 million payable under the transaction agreement upon certain termination events. Autonomy may also be required to pay a break-up fee to Interwoven of $25 million under the Acquisition Agreement in certain circumstances.
Further details of the terms of the Acquisition Agreement are set out in Appendix I.
For the fiscal year ended December 31, 2007, under US GAAP, Interwoven had revenues of $225.7 million (compared to $200.3 million for the fiscal year ended December 31, 2006). Profits before tax for the fiscal year ended December 31, 2007, were $23.2 million (compared to $8.6 million for the fiscal year ended December 31, 2006). On January 6, 2009, Interwoven announced that it expects to report total revenues of $69.5 million to $70.0 million for the three months ended December 31, 2008, with license revenues of approximately $26.5 million for that period. Interwoven also expects to report net income per share of $0.21 to $0.23 on a U.S. GAAP basis and $0.22 to $0.24 on a non-U.S. GAAP basis. The non-U.S. GAAP results exclude the expected amortization of stock-based compensation expense of approximately $3.0 million, amortization of purchased technology of approximately $700,000, amortization of intangible assets of approximately $700,000 and the related tax impact of approximately $4.0 million. These expected results are based on preliminary information.
General Meeting of Autonomy
The Acquisition is conditional, inter alia, on the approval of Autonomy shareholders at a General Meeting, notice of which will be sent to shareholders in due course.
Information on Interwoven
Interwoven is a global leader in content management solutions. Interwoven's software and services enable organizations to maximize online business performance and organize, find, and govern business content. Interwoven solutions unlock the value of content by delivering the right content to the right person in the right context at the right time. Over 4,600 of the world's leading companies, professional services firms and governments have chosen Interwoven, including adidas, Airbus, Avaya, BT, Cisco, Citi, Delta Air Lines, DLA Piper, FedEx, Grant Thornton, Hilton Hotels, Hong Kong Trade and Development Council, HSBC, LexisNexis, MasterCard, Microsoft, Samsung, Shell, Qantas Airways, Tesco, Virgin Mobile and White & Case.
Interwoven is listed on the NASDAQ National Market under the ticker symbol "IWOV", and has its headquarters in San Jose, California.
For the financial year ended December 31, 2007, Interwoven reported under U.S. GAAP gross assets of $468.4 million and income from operations of $13.9 million.
Autonomy intends to send a circular to its shareholders containing a notice of General Meeting in due course (the "Circular"), which will also set out the timetable for the Acquisition. Assuming all conditions are satisfied, Autonomy currently expects the Acquisition to complete in the second quarter of 2009.
No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings per share of Autonomy for the current or future financial years would necessarily match or exceed the historical published earnings per share of Autonomy.
Deutsche Bank and Morgan Stanley & Co. Limited are acting as financial advisors, and in accordance with Chapter 8 of the Listing Rules, sponsors to Autonomy in connection with the Acquisition.
Deutsche Bank AG is authorised under German Banking Law (competent authority: BaFin - Federal Financial Supervising Authority) and regulated by the Financial Services Authority for the conduct of UK business. Deutsche Bank AG is acting for Autonomy and no one else in connection with the Acquisition and the Placing and will not be responsible to anyone other than Autonomy for providing the protections afforded to clients of Deutsche Bank nor for providing advice in connection with the Acquisition and Placing.
Morgan Stanley & Co. Limited, which is authorised and regulated by the Financial Services Authority, is acting exclusively for Autonomy Corporation plc and for no one else in connection with the Acquisition and the Placing and will not be responsible to anyone other than Autonomy Corporation plc for providing the protections afforded to the customers of Morgan Stanley & Co. Limited or for providing advice in relation to the Acquisition and the Placing or any transaction or arrangement referred to herein.
This announcement does not constitute, or form part of, an offer to sell, or the solicitation of an offer to subscribe for or buy any securities.
This announcement is not an offer of securities for sale in or into the United States. Any securities issued in connection with the Acquisition have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") and may not be offered, sold, taken up or renounced in the United States absent registration under the Securities Act or an applicable exemption from such registration. There will be no public offering of securities in the United States. The ordinary shares have not been and will not be registered with any regulatory authority of any state or other jurisdiction of the United States.
Any response in relation to the Acquisition should be made only on the basis of the information in the Circular. Autonomy urges Shareholders and prospective Shareholders to read the Circular when it becomes available because it will contain important information relating to the Acquisition.
Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates and projections about its industry, its beliefs and assumptions. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the Company's control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. These factors include, amongst others, the ability to consummate the transaction; the ability of Autonomy to successfully integrate Interwoven's operations and employees; the ability to realise anticipated synergies and cost savings; technology risks, including dependence on core technology; fluctuations in quarterly results; dependence on new product development; rapid technological and market change; reliance on sales by others; management of growth; dependence on key personnel; rapid expansion; growth of the internet; financial risk management; and future growth subject to risks. The Company cautions shareholders and prospective shareholders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.
Summary of the Acquisition Agreement
Autonomy has entered into an Agreement and Plan of Merger dated January 22, 2009, to acquire Interwoven, Inc. (the "Acquisition Agreement").
Under the Acquisition Agreement, the transaction is structured as a reverse triangular merger whereby an indirect wholly owned subsidiary of Autonomy will merge with and into Interwoven with Interwoven surviving as an indirect wholly-owned subsidiary of Autonomy. The consideration payable to Interwoven shareholders will be $16.20 per share in cash.
The Acquisition Agreement contains customary representations, warranties and covenants for both parties. In addition, Autonomy and Interwoven have agreed to file the required documentation with the FTC and DOJ as promptly as practicable after the execution of the Acquisition Agreement.
Closing of the Acquisition is conditional upon, inter alia: approval by Autonomy shareholders at a General Meeting; approval by Interwoven stockholders; expiration of any waiting period under the HSR Act; no material adverse effect on Interwoven shall have occurred; and Interwoven having at least $174,198,525 if the closing occurs prior to March 20, 2009; at least $179,198,525 if the closing occurs between March 20, 2009 and March 31, 2009; and at least $185,198,525 if the closing occurs between April 1, 2009 and the three month anniversary of the date of signing the Merger Agreement.
The Acquisition Agreement contains certain termination provisions:
Interwoven has agreed to pay Autonomy a break-up fee of $25 million if (A) Autonomy terminates the Acquisition as a result of the Triggering Events specified above, (B) the Acquisition does not close due to the failure of Interwoven to obtain stockholder approval, and prior to such time an acquisition proposal is pending and within 12 months of this termination an acquisition of Interwoven is consummated, or (C) Interwoven terminates the agreement to accept a superior proposal. In addition, Interwoven has agreed to pay Autonomy a break-up fee of $7 million if the Acquisition does not close due to the failure of Interwoven to obtain stockholder approval.
Autonomy has agreed to pay Interwoven a break-up fee of $25 million (subject to such payment being legal under applicable law) if the Acquisition Agreement is terminated due to (A) Autonomy's directors no longer supporting the Acquisition, (B) Autonomy failing to obtain proceeds sufficient to consummate the transaction or failing to close the transaction by the earlier of 15 business days after the satisfaction or waiver of the transaction's closing conditions, or the day preceding the Termination Date, or (C) Autonomy failing to obtain shareholder approval.
The following principal definitions apply throughout this document unless the context requires otherwise.