Federal signal signs definitive agreement to acquire sirit at cdn$0.30 per common share
Acquisition Will Transform Federal Signal into a Leader in Intelligent Transport Systems With Portfolio of High Value, Best-in-Class Products
Federal Signal Corporation, a leader in environmental, safety and transportation solutions and Sirit Inc. (TSX: SI), a global provider of radio frequency identification (RFID) technology today announced that they have signed a definitive agreement pursuant to which Federal Signal will acquire all of the issued and outstanding common shares of Sirit (the Common Shares) for cash consideration of CDN$0.30 per share by way of a court approved plan of arrangement under the Business Corporations Act (Ontario) (the Arrangement). The transaction has a total equity value of approximately CDN$49.5 million (US$48.0 million).
The CDN$0.30 per share cash purchase price represents a premium of 37% over Sirits 30-day average closing stock price, and a premium of 60% over Sirits 60-day average closing stock price. Sirit is a leading designer, developer and manufacturer of RFID technology for applications such as Tolling, Electronic Vehicle Registration, Parking and Access Control, Asset Management, Cashless Payments and Supply Chain Systems. The combination of Sirits RFID technology with Federal Signals detection and classification technology (acquired in the December 2009 purchase of Diamond Consulting Services) and existing PIPS automated license plate recognition technology, immediately transforms Federal Signal into a leader in Intelligent Transport Systems.
We are excited about this transaction with Sirit, as it further strengthens Federal Signals best-inclass product portfolio and advances our stated strategy of driving growth through our Public Safety Systems platform, said William Osborne, Federal Signal's President and Chief Executive Officer. Sirit, Diamond Consulting Services and PIPS have a proven record of success in jointly delivering superior technology-based client solutions. We are committed to investment in research and development to maintain Sirits reputation for technical excellence and with the addition of Sirits talented employees, we look forward to further differentiating Federal Signals Public Safety Systems offering.
Global market trends for Intelligent Transport Systems are robust and we believe the addition of Sirit will enhance long-term earnings and provide greater revenue visibility through recurring revenues, Mr. Osborne continued. We are confident Federal Signal will be better positioned to help customers capitalize on road-user charging technologies and deliver enhanced value to our stockholders. "We are thrilled to be joining Federal Signal and are excited by the opportunities we will have as part of a larger organization with greater financial resources and access to a wider customer base. The combination of Sirit and Federal Signal creates a superior technology platform and service offering, while providing customers with more complete and fully integrated solutions, said Norbert Dawalibi, President and Chief Executive Officer of Sirit. We look forward to working closely with the Federal Signal team to ensure a smooth transition and complete the transaction as expeditiously as possible," added Mr. Dawalibi.
Sirits board of directors unanimously approved the transaction and determined that it is in the best interests of Sirit and its shareholders (the Shareholders). The board made its decision following the report and favorable recommendation of an independent committee of Sirits board of directors. In reaching its recommendation, Sirits independent committee considered a fairness opinion from its financial advisor, GMP Securities L.P. A copy of the fairness opinion, the factors considered by the independent committee and the board and other relevant information will be included in the management information circular that will be sent to the Shareholders of Sirit in connection with the special meeting anticipated to be held on or about February 26, 2010 to consider the Arrangement. The record date for purposes of determining Shareholders entitled to vote at the special meeting has been set as of the close of business on January 25, 2010.
Certain executive officers, directors and Shareholders of Sirit owning approximately 28% of the outstanding common shares have entered into a voting and lock-up agreement with Federal Signal under which they have agreed to vote their shares in favor of the Arrangement. The arrangement agreement contains customary terms and conditions for a transaction of this nature, including a prohibition upon Sirit from soliciting or initiating any discussion concerning any other business combination or similar transaction, the right of Federal Signal to match any unsolicited superior proposal received by Sirit and a termination fee of CDN$1.5 million payable to Federal Signal by Sirit in certain circumstances.
The closing of the Arrangement is subject to the satisfaction of certain closing conditions, including, among others, obtaining certain court approvals as well as the approval of Sirits shareholders. For the Arrangement to proceed, a special resolution approving the Arrangement must be approved by not less than two-thirds of the votes cast by Sirits shareholders. The transaction is not subject to financing. Federal Signal intends to finance the transaction through cash on hand and existing bank lines of credit.
Upon completion of the transaction, Sirit will operate as part of Federal Signals Safety and Security Systems Group.
The CDN$0.30 per share cash purchase price represents a premium of 37% over Sirits 30-day average closing stock price, and a premium of 60% over Sirits 60-day average closing stock price. Sirit is a leading designer, developer and manufacturer of RFID technology for applications such as Tolling, Electronic Vehicle Registration, Parking and Access Control, Asset Management, Cashless Payments and Supply Chain Systems. The combination of Sirits RFID technology with Federal Signals detection and classification technology (acquired in the December 2009 purchase of Diamond Consulting Services) and existing PIPS automated license plate recognition technology, immediately transforms Federal Signal into a leader in Intelligent Transport Systems.
We are excited about this transaction with Sirit, as it further strengthens Federal Signals best-inclass product portfolio and advances our stated strategy of driving growth through our Public Safety Systems platform, said William Osborne, Federal Signal's President and Chief Executive Officer. Sirit, Diamond Consulting Services and PIPS have a proven record of success in jointly delivering superior technology-based client solutions. We are committed to investment in research and development to maintain Sirits reputation for technical excellence and with the addition of Sirits talented employees, we look forward to further differentiating Federal Signals Public Safety Systems offering.
Global market trends for Intelligent Transport Systems are robust and we believe the addition of Sirit will enhance long-term earnings and provide greater revenue visibility through recurring revenues, Mr. Osborne continued. We are confident Federal Signal will be better positioned to help customers capitalize on road-user charging technologies and deliver enhanced value to our stockholders. "We are thrilled to be joining Federal Signal and are excited by the opportunities we will have as part of a larger organization with greater financial resources and access to a wider customer base. The combination of Sirit and Federal Signal creates a superior technology platform and service offering, while providing customers with more complete and fully integrated solutions, said Norbert Dawalibi, President and Chief Executive Officer of Sirit. We look forward to working closely with the Federal Signal team to ensure a smooth transition and complete the transaction as expeditiously as possible," added Mr. Dawalibi.
Sirits board of directors unanimously approved the transaction and determined that it is in the best interests of Sirit and its shareholders (the Shareholders). The board made its decision following the report and favorable recommendation of an independent committee of Sirits board of directors. In reaching its recommendation, Sirits independent committee considered a fairness opinion from its financial advisor, GMP Securities L.P. A copy of the fairness opinion, the factors considered by the independent committee and the board and other relevant information will be included in the management information circular that will be sent to the Shareholders of Sirit in connection with the special meeting anticipated to be held on or about February 26, 2010 to consider the Arrangement. The record date for purposes of determining Shareholders entitled to vote at the special meeting has been set as of the close of business on January 25, 2010.
Certain executive officers, directors and Shareholders of Sirit owning approximately 28% of the outstanding common shares have entered into a voting and lock-up agreement with Federal Signal under which they have agreed to vote their shares in favor of the Arrangement. The arrangement agreement contains customary terms and conditions for a transaction of this nature, including a prohibition upon Sirit from soliciting or initiating any discussion concerning any other business combination or similar transaction, the right of Federal Signal to match any unsolicited superior proposal received by Sirit and a termination fee of CDN$1.5 million payable to Federal Signal by Sirit in certain circumstances.
The closing of the Arrangement is subject to the satisfaction of certain closing conditions, including, among others, obtaining certain court approvals as well as the approval of Sirits shareholders. For the Arrangement to proceed, a special resolution approving the Arrangement must be approved by not less than two-thirds of the votes cast by Sirits shareholders. The transaction is not subject to financing. Federal Signal intends to finance the transaction through cash on hand and existing bank lines of credit.
Upon completion of the transaction, Sirit will operate as part of Federal Signals Safety and Security Systems Group.
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