WISCONSIN RAPIDS, Wis.,
Oct. 10, 2011 /PRNewswire/ --
Renaissance Learning, Inc. (Nasdaq: RLRN), a leading provider of
technology-based school improvement and student assessment programs
for K-12 schools, announced today that it has received an
unsolicited, revised definitive acquisition proposal from Plato
Learning, Inc. ("Plato Learning"). Under the revised
definitive proposal, Plato Learning proposes to acquire all of the
outstanding shares of Renaissance Learning for an aggregate
purchase price of approximately $496.0
million, which is financially equivalent to the acquisition
of all of the outstanding shares of Renaissance Learning for
$16.90 per share in cash. The
revised definitive proposal does not provide for an allocation of
the merger consideration between co-founders Terrance and Judith Paul and affiliates and
members of their family (the "Paul Shareholders"), on one hand, and
the other shareholders of Renaissance Learning, on the other hand,
but provides that Renaissance Learning's Board of Directors or Mr.
and Mrs. Paul may elect to allocate the merger consideration in any
manner. Under the revised definitive proposal, the additional
consideration payable under the revised terms of the proposed
acquisition would be financed with an additional $25.0 million in equity pursuant to signed
commitment letters and guarantees from funds advised by
Thoma Bravo, LLC and HarbourVest
Partners, LLC. The revised definitive proposal is not subject to a
financing condition or further due diligence.
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Renaissance Learning previously announced that Renaissance
Learning and the Permira Funds entered into an amendment to the
definitive merger agreement dated August 15,
2011 under which a company formed at the direction of the
Permira Funds will acquire all of the outstanding shares of
Renaissance Learning. Under the amended merger agreement, an
affiliate of the Permira Funds will acquire all of the outstanding
shares of Renaissance Learning held by the Paul Shareholders for
$15.00 per share in cash, and will
acquire all other outstanding shares of Renaissance Learning for
$16.60 per share in cash, for an
aggregate purchase price of approximately $455.0 million, which is financially equivalent
to the acquisition of all of the outstanding shares of Renaissance
Learning for $15.50 per share in
cash.
In accordance with its fiduciary duties, Renaissance Learning's
Board of Directors will give proper consideration in due course to
Plato Learning's revised definitive proposal. In the
meantime, Renaissance Learning's Board of Directors has approved
and continues to recommend that shareholders approve and adopt the
amended merger agreement with affiliates of the Permira Funds at
the special meeting of Renaissance Learning's shareholders
scheduled to be held on October 17,
2011. Under an amended shareholders agreement, the
Paul Shareholders have agreed to vote the shares they control
representing, in the aggregate, approximately 69% of Renaissance
Learning's outstanding shares, in favor of the amended Permira
Funds merger agreement.
In connection with the amended Permira Funds merger agreement,
on October 3, 2011, Renaissance
Learning filed with the SEC a supplement, dated September 30, 2011, to the proxy statement
previously distributed in connection with the special shareholders'
meeting and has furnished such supplement to Renaissance Learning's
shareholders. The transaction remains subject to customary
closing conditions, including approval by Renaissance Learning's
shareholders. As previously announced, the waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, in connection with the proposed merger has ended.
Update on Litigation Related to the Merger
As previously disclosed in Renaissance Learning's proxy
statement supplement, a putative class action complaint relating to
the Permira Funds merger agreement was filed by Data Key Partners
on September 23, 2011 in the Circuit
Court of Wood County,
Wisconsin.
On October 4, 2011, Data Key
Partners filed an amended complaint maintaining the claims in the
original complaint and updating its allegations about the current
status of the Permira Funds merger agreement and the Plato Learning
proposal to acquire Renaissance Learning, and adding a derivative
claim seeking to revoke the Permira Funds merger agreement because
of the alleged lack of independence of Renaissance Learning's board
of directors and the fiduciary duty violations alleged in the
complaint.
On October 7, 2011, Data Key
Partners filed a lawsuit in the United States District Court,
Western District of Wisconsin
asserting substantially the same claims as in its original state
court action, and adding a claim alleging violations of the proxy
statement disclosure requirements under Section 14(a) of the
Securities Exchange Act of 1934. In addition, Data Key
Partners filed a motion for a temporary restraining order to
enjoin Renaissance Learning and the Permira Funds from consummating
the merger contemplated by the Permira Funds merger agreement
pending expedited discovery and trial.
Also on October 7, 2011, a second
putative class action complaint was filed by Michael McDonald in the United States District
Court, Western District of Wisconsin asserting substantially the same
claims asserted in the suits brought by Data Key Partners, with the
exception of the derivative claim. The complaint also alleges
that the termination fee and nonsolicitation provisions of the
Permira Funds merger agreement constitute breaches of fiduciary
duty by the defendants.
On October 7, 2011 and
October 9, 2011, respectively, Plato
Learning filed motions to intervene in the Data Key Partners and
Michael McDonald federal lawsuits in
order to assert its own claim against Renaissance Learning and its
board members. Plato Learning claims that Renaissance
Learning failed to act in good faith in its dealings with
Plato Learning by not engaging in a fair and just process and by
rejecting what Plato Learning contends was a superior acquisition
proposal; that Renaissance Learning and its board members allegedly
accepted the Permira Fund's purportedly inferior acquisition
proposal without legal justification and, in doing so, allegedly
interfered with a prospective contractual relationship between
Plato Learning and Renaissance Learning's shareholders; and that
Renaissance Learning violated Wisconsin law by colluding and conspiring to
reduce competition for purchasing Renaissance Learning and
precluding Plato Learning from fairly acquiring Renaissance
Learning. As a result, Plato Learning seeks to
preliminarily and permanently enjoin the consummation of the merger
contemplated by the Permira Funds merger agreement.
Renaissance Learning and the other defendants believe these
actions are without merit and intend to vigorously defend against
their claims.
About Renaissance Learning, Inc.
Renaissance Learning, Inc. is a leading provider of
technology-based school improvement and student assessment programs
for K12 schools. Adopted by approximately 70,000
schools, Renaissance Learning's tools provide daily formative
assessment and periodic progress-monitoring technology to enhance
core curriculum, support differentiated instruction, and
personalize practice in reading, writing and math. Renaissance
Learning products and school improvement programs help educators
make the practice component of their existing curriculum more
effective by providing tools to personalize practice and easily
manage the daily activities for students of all levels. As a
result, teachers using Renaissance Learning products and programs
accelerate learning, get more satisfaction from teaching, and help
students achieve higher test scores on state and national tests.
Renaissance Learning has seven U.S. locations and subsidiaries in
Canada and the United Kingdom.
About Permira
Permira is a European private equity firm with global reach.
The Permira funds, raised from pension funds and other
institutions, make long-term investments in companies with the
ambition of transforming their performance and driving sustainable
growth.
Founded in 1985, the firm advises funds with a total committed
capital of approximately $30 billion.
Over the past 26 years the Permira funds have made nearly 200
private equity investments, over 30% of which have been in the core
sector of Technology, Media & Telecom ("TMT"). The
Permira funds portfolio in TMT includes market-leading software
providers, online commerce vendors, and digital content production
and distribution companies, among others. With offices in
New York and Menlo Park, Permira has had a presence in
North America since 2002.
Renaissance Learning represents the second North American
investment for the Permira funds in 2011.
For more information visit: www.permira.com
Forward-Looking Statements
This news release contains forward-looking statements that
involve risk and uncertainties. Such statements constitute
forward-looking statements within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Readers are cautioned not to place undue reliance on these
forward-looking statements and any such forward-looking statements
are qualified in their entirety by reference to the following
cautionary statements. All forward-looking statements speak
only as of the date hereof and are based on current expectations
and involve a number of assumptions, risks and uncertainties that
could cause the actual results to differ materially from such
forward-looking statements. For example, Renaissance Learning
may not be able to complete the proposed merger with affiliates of
the Permira Funds on the terms described in the amended merger
agreement, as amended, or other acceptable terms or at all because
of a number of factors, including the failure to obtain shareholder
approval or the failure to satisfy the closing conditions.
These factors, and other factors that may affect the business
or financial results of Renaissance Learning, are described in the
risk factors included in Renaissance Learning's filings with the
Securities and Exchange Commission, including Renaissance
Learning's 2010 Annual Report on Form 10-K and later filed
quarterly reports on Form 10-Q and Current Reports on Form 8-K,
which factors are incorporated herein by reference.
Renaissance Learning expressly disclaims a duty to provide
updates to forward-looking statements, whether as a result of new
information, future events or other occurrences.
Additional Information for Shareholders
In connection with the proposed merger transaction with
affiliates of the Permira Funds, Renaissance Learning filed a
definitive proxy statement on Schedule 14A with the SEC on
September 12, 2011 and a supplement
to the proxy statement on October 3,
2011. Renaissance Learning has furnished both the
proxy statement and the supplement to the proxy statement to its
shareholders. SHAREHOLDERS ARE URGED TO READ THE PROXY
STATEMENT AND THE SUPPLEMENT TO THE PROXY STATEMENT BECAUSE THE
PROXY STATEMENT AND THE SUPPLEMENT TO THE PROXY STATEMENT CONTAIN
IMPORTANT INFORMATION ABOUT THE PERMIRA FUNDS MERGER AGREEMENT, AS
AMENDED. Shareholders may obtain a free copy of the proxy
statement, the supplement to the proxy statement and other relevant
documents filed with the SEC from the SEC's website
(http://www.sec.gov). Shareholders may also obtain these
documents, free of charge, from Renaissance Learning by accessing
Renaissance Learning's website (http://www.rlrninvest.com) or by
directing a request to Renaissance Learning, Inc., 2911 Peach
Street, P.O. Box 8036, Wisconsin Rapids,
Wisconsin 54495-8036, Attention: Corporate
Secretary.
Renaissance Learning and certain of its directors and executive
officers may be deemed to be participants in the solicitation of
proxies from shareholders of Renaissance Learning in favor of the
proposed merger with affiliates of the Permira Funds.
Information about the directors and executive officers of
Renaissance Learning is set forth in the proxy statement for
Renaissance Learning's 2011 annual meeting of shareholders, as
filed with the SEC on Schedule 14A on March
16, 2011. Additional information regarding the
interests of these individuals and other persons who may be deemed
to be participants in the solicitation is included in the
definitive proxy statement on Schedule 14A Renaissance Learning
filed with the SEC on September 12,
2011, and the supplement to the proxy statement filed on
October 3, 2011, relating to the
proposed merger with affiliates of the Permira Funds.
SOURCE Renaissance Learning, Inc.
