The Learning Company, Inc. and Broderbund Software Reach Definitive Merger Agreement
CAMBRIDGE, Mass., and NOVATO, Calif., June 22 /PRNewswire/ -- The Learning Company, Inc. (NYSE: TLC) and Broderbund Software, Inc. (Nasdaq: BROD) announced today that they have reached a definitive agreement to merge. The Learning Company will issue 0.80 shares of its common stock for each outstanding share of Broderbund common stock. Based upon the closing price of The Learning Company's common stock on Friday, June 19, 1998, this exchange ratio implies a purchase price of $20 per share and an aggregate transaction value of approximately $420 million.
The closing of the transaction is subject to certain conditions, including expiration of applicable waiting periods under pre-merger notification regulations and the approval of stockholders of each company. Broderbund's and The Learning Company's Boards of Directors have each approved the transaction and intend to recommend that stockholders approve the transaction.
Thomas H. Lee Company and Bain Capital, Inc., each of which are significant Learning Company stockholders, have agreed to vote in favor of the merger.
Douglas Carlston, Chairman and Founder of Broderbund, has also agreed to vote
his shares in favor of the merger. The transaction is expected to close
before the end of September 1998 and will be accounted for using the
pooling-of-interests method of accounting.
"We are absolutely delighted to announce this merger," said Michael Perik,
Chairman and Chief Executive Officer of The Learning Company. "Broderbund is
one of the legends of the consumer software industry and certainly has one of
the most impressive portfolios of evergreen software brands available in the
marketplace today. Broderbund's educational, reference and productivity
titles complement those of the Learning Company and should allow us to provide
an even broader array of high quality products to our customers. In addition,
we expect to be able to leverage our combined distribution in retail, direct,
response, international and school channels to maximize value for the
stockholders of the new organization. We expect that this merger will be
accretive to fiscal 1999 earnings by at least $.1O per share for The Learning
Company."
"In an industry that has been rapidly consolidating, we believe that this
merger will align Broderbund with the strongest possible partner," said Joe
Durrett, Chief Executive Officer of Broderbund. "The combination of brands
will produce leading market positions for most of the core age, product, and
price segments in education as well as leading positions in home graphics,
home design, genealogy and a unique position in family entertainment software
anchored by the Myst and Riven titles."
Kevin O'Leary, President of The Learning Company said, "Broderbund's
well-known, award-winning brands, including Carmen Sandiego, Family Tree
Maker, Arthur, KidPix and The Print Shop are an excellent addition to the
Learning Company portfolio. The combination of our on-line technologies will
allow us to expedite our development efforts to create state-of-the-art
Internet products for genealogy, education, filtering services and
productivity. In addition, the combined business will have access to a
database of over 20 million registered end-users who have purchased one of our
products and desire to hear about more offerings, which will allow us to build
our presence in the on-line and Internet channel."
Douglas Carlston, Chairman and Founder of Broderbund, said, "Broderbund
has always produced the finest quality products in our industry and has built
major franchises including Carmen Sandiego, The Print Shop, Living Books, and
Family Tree Maker. Combining our award-winning titles with those of The
Learning Company will give us exceptional strength in both domestic and
international markets and provide great opportunities for the combined new
company."
This release contains information forecasting the results of the company
after the acquisition of Broderbund, which are "forward-looking statements"
under the federal securities laws. Actual results could differ materially
from those forecasts and there can be no assurance that results will be
achieved. Important factors that could cause actual results to differ
materially from those present or estimated include: the company's ability to
predict the revenues and profit it will generate from the sale of Broderbund's
product line; the effects of general economic conditions; and the ability to
achieve economies of scale and revenue growth from the acquisition.
Management will hold a joint informational telephone conference call at
8:45 a.m. EST on June 22, 1998 for investors and analysts. The telephone
number for the call is 1-800-230-1951.
Broderbund Software, Inc. develops, publishes and markets a broad line of
interactive software for use in homes, schools and small businesses. Since
its founding in 1980, Broderbund has repeatedly broken new ground conceiving
and developing families of software products with enduring customer appeal
based on creativity, innovation and ease-of-use. The company, headquartered
in Novato, CA, is committed to providing its customers with engaging products
that set quality standards and take advantage of the latest technologies. The
Broderbund web site is located at: broderbund.com.
The Learning Company, Inc. (NYSE: TLC) develops, publishes, and markets a
family of consumer software brands that educate across every age, from young
children to adults. The company's products are sold in more than
23,0O0 retail stores in North America and through multiple distribution
channels including school sales, on-line, direct marketing and OEM. The
company also develops, publishes and distributes products internationally
through subsidiaries in France, Germany, the United Kingdom, Holland and
Japan, and with distributors throughout Europe, Latin America and the Pacific
Rim. The company's headquarters are located at One Athenaeum Street,
Cambridge, MA 02142. The corporate Web site is located at
learningco.com.
NOTE: All trademarks are the property of their respective holders.
SOURCE The Learning Company, Inc.
-0- 06/22/98 |
