any000Sphere 3D to acquire Overland for $81.13-million (U.S.)
2014-05-15 17:00 ET - News Release
Mr. Peter Tassiopoulos reports
SPHERE 3D AND OVERLAND STORAGE ENTER INTO DEFINITIVE MERGER AGREEMENT
Sphere 3D Corp. and Overland Storage Inc.'s boards of directors have unanimously approved a definitive merger agreement, under which the companies would combine to create a leading global virtualization and data management software solutions company. The name of the combined company will be Sphere 3D.
Under the terms of the merger agreement, each outstanding share of Overland common stock will be exchanged for 0.510594 common shares of Sphere 3D, subject to certain potential adjustments as set forth in the agreement. After completion of the transaction, it is expected that current holders of Overland shares will own approximately 28.8 per cent of Sphere 3D on a fully diluted basis as a result of their exchange of shares in the merger. Based on the closing sales price of Sphere 3D common shares on May 14, 2014, the last trading day prior to the announcement of the transaction on the TSX Venture Exchange, the total consideration payable to holders of Overland equity in the transaction has an implied value of approximately $81.13-million (U.S.), or approximately $4.43 (U.S.) per Overland share.
On May 14, 2014, the last trading day prior to the announcement of the transaction, the closing price of the Overland shares on the Nasdaq was $2.90 (U.S.) and the closing price of the Sphere 3D shares on the TSX-V was $9.46 (or $8.68 (U.S.)). The acquisition price represents a premium of approximately 53 per cent over the closing price of the Overland shares on the Nasdaq on the last trading day immediately preceding the announcement of the transaction and a premium of approximately 27 per cent over the weighted average trading price of the Overland shares on the Nasdaq and Sphere 3D on the TSX-V for the 30 trading days immediately preceding the announcement of the transaction.
Sphere 3D and Overland have been working in tandem to develop an integrated application virtualization and data storage platform, as well as a virtual desktop infrastructure (VDI) solutions, which are already installed at select strategic customers and partners. The application virtualization platform allows native third party applications to be delivered in the cloud or on premise on a multitude of end-point devices independent of their operating system. The VDI market, a key segment of the virtualization market, is estimated to be over $5-billion and growing 20 per cent annually, according to Frost & Sullivan. Through the combination, Sphere 3D will have greater financial and operational scale, and a large and well-established worldwide distribution network and tier one OEM partnerships. |
