By Lisa Kerner
Charlotte, N.C., Nov. 5 - JDA Software Group, Inc. announced an agreement to acquire i2 Technologies, Inc. in a deal with a total enterprise value of $396 million on a diluted basis.
According to a JDA news release, it plans to issue approximately $275 million of senior unsecured notes by Dec. 18.
Each share of i2 common stock would then be converted into the right to receive approximately $12.70 in cash and 0.256 shares of JDA common stock for a total value of $18.00 based on JDA's closing stock price on Wednesday.
However, if JDA fails to raise sufficient funds, i2 shareholders, under an alternative structure, would receive about $6.00 in cash and 0.580 shares of JDA common stock for a total value of $18.00 per share.
Wells Fargo Foothill and Wells Fargo Securities committed to provide a $120 million term loan and a $20 million revolving credit facility to finance the transaction under the alternative structure, the release said.
Under either plan, each issued and outstanding share of i2's series B convertible preferred stock will be converted into the right to receive $1,100 in cash as well as all accrued dividends.
Both companies' boards of directors have approved the transaction, which is expected to close in the first quarter of 2010, said JDA.
The merger agreement includes termination rights for both companies.
According to the release, a $15 million termination fee is payable by i2 if it terminates the agreement to accept a superior proposal.
JDA would pay a $7 million fee if its stockholders fail to approve the deal. The company would pay $30 million to i2 if JDA does not close the merger due to the failure to obtain financing.
The companies had planned to merge last year, but that merger agreement was terminated in December 2008.
Goldman, Sachs & Co. advised JDA, a Scottsdale, Ariz., software services provider, while Thomas Wiesel Partners LLC advised i2.
i2 is a Dallas-based supply chain management solutions company.
| Acquirer: | JDA Software Group, Inc.
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| Target: | i2 Technologies, Inc.
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| Announcement date: | Nov. 5
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| Transaction total: | $396 million
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| Price per share: | $18.00 in cash and JDA common stock
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| Termination fees: | $7 million, $15 million, $30 million
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| Expected closing: | First quarter of 2010
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| Stock price for acquirer: | Nasdaq: JDA: $20.70 on Nov. 4
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| Stock price for target: | Nasdaq: ITWO: $16.51 on Nov. 4
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