NTRO Wyndcrest Holdings Offers To Buy Netro For About $4.15/Share
Thursday November 14, 10:05 am ET
WASHINGTON -(Dow Jones)- Wyndcrest Holdings LLC offered to acquire Netro Corp. (NasdaqNM:NTRO - News) for about $4.15 a share cash, or $158.5 million, according to a letter of intent addressed to Netro's board.
The purchase price represents Netro's Aug. 30 cash balance, minus approximately $20 million that will be depleted during the fourth quarter prior to closing, the letter said.
Under the offer, Wyndcrest would acquire 38.2 million of Netro's outstanding common stock.
The offer price takes into account a reserve as necessary to shut down operations and arrange for the preservation or sale of the company's technology, the letter said.
If Wyndcrest determines during a due diligence review that amounts required for the reserve total $10 million, the price would be adjusted down to about $ 3.89 a share.
Shares of Netro closed Wednesday at $1.98, down 7 cents, or 3.4%.
Wyndcrest said due diligence would take no more than 45 days.
Under the agreement, the company would issue new common shares to current shareholders equal to a 25% ownership interest in the company.
In the letter obtained Wednesday by Dow Jones Newswires, Wyndcrest said the offer would be subject to definitive agreements, approval by Netro's board and third-party consents.
The offer includes a 90-day no-solicitation period.
The letter of intent will terminate if the parties haven't executed a definitive agreement by Jan. 31, 2003.
Wyndcrest said Wednesday that it would "like to consummate a transaction with your company that provides, for your shareholders, the maximum amount of near- term liquidity, as well as participation in the ultimate sale and/or future redeployment of your technology."
Netro officials weren't immediately available to comment.
The offer isn't the first time Wyndcrest has made a bid for Netro.
On Aug. 12, Netro's board rejected Wyndcrest's revised $247 million, or $4.04- a-share, acquisition proposal because, it said, the bid didn't reflect Netro's true long-term value.
Netro's board had previously rejected Wyndcrest's original $245.4 million, or $4.01-a-share bid.
-By Ben Siegel, Dow Jones Newswires; 202-628-7689 |
