SAP has agreed to make a cash tender offer directly for all outstanding shares of Retek at $8.50 per share, representing a 42 percent premium for Retek stockholders based on the market closing price of Feb. 25, 2005. On a fully diluted basis, the value of the offer is approximately $496 million. The aggregate value of the transaction is approximately $394 million net of Retek’s existing cash, cash equivalents and investments.
“We are excited about the opportunity to join the SAP family and the value that we believe this combination will bring to our customers, employees and shareholders,” said Marty Leestma, president and chief executive officer, Retek. “SAP provides enormous resources, extensive application and integration technology experience, and the global reach and scope to provide an unprecedented opportunity for the retail industry. By leveraging the best of our combined assets, we believe this combination will drive significant growth opportunities around the world. We believe that SAP’s offer is a good deal for Retek stockholders, and our board of directors has unanimously recommended that it be accepted.” Headquartered in Minneapolis, Retek provides an integrated retail application suite and best-of-breed solutions to more than 200 customers in more than 20 countries around the world. With 2004 annual revenue of $174.2 million and approximately 525 employees, Retek also has offices in Atlanta, London and Melbourne.
In making the announcement, SAP said the retail industry is entering a new phase of package software adoption, as retailers are increasingly considering IT as a strategic instrument to drive competitive differentiation and business growth. The combination of Retek’s application portfolio, industry expertise and market presence will allow SAP to respond to this demand even more successfully and will create a clear leadership position for SAP to deliver the solutions retail companies are looking for now and in the future.
“The global retail industry is large and represents a significant growth opportunity for SAP,” said Henning Kagermann, chief executive officer, SAP. “Retek offers many software solutions to augment its existing presence and will enable us to offer the most comprehensive solution in the industry, from the point of sale through the entire retail supply chain. The acquisition of Retek is in keeping with SAP’s growth strategy to invest in companies and solutions that expand the SAP portfolio, deliver best-in-class industry solutions, provide new capabilities and help customers meet ever-changing market conditions. We welcome the Retek team to SAP.”
It is expected that the tender offer will commence within a week, will be subject to customary closing conditions, including regulatory approvals, and is expected to close in early April unless extended. Stockholders of Retek are strongly encouraged to read the Tender Offer Statement on Schedule TO to be filed by SAP America, Inc. and its subsidiary when it becomes available because it will contain important information about the tender offer. Stockholders of Retek are strongly encouraged to read the Solicitation/Recommendation Statement on Schedule 14D-9 to be filed by Retek when it becomes available because it will contain important information about the tender offer. Investors may obtain the Tender Offer Statement on Schedule TO, the Solicitation/Recommendation Statement on Schedule 14D-9 and any other documents filed with the SEC for free at the SEC’s Web site. Materials filed by SAP America may be obtained for free at SAP’s Web site, www.sap.com. Materials filed by Retek may be obtained for free at Retek’s Web site. Credit Suisse First Boston LLC acted as financial advisor to SAP; Deutsche Bank Securities Inc. acted as financial advisor to Retek.
Source: SAP AG