FRIENDLY OFFER IN US BY NTT DATA FOR INTELLIGROUP
June 14 2010 - 7:33AM
UK Regulatory
TIDMNPN
RNS Number : 5649N
Nippon Telegraph and Telephone Corp
14 June 2010
June 14, 2010
Company Name: Nippon Telegraph and Telephone Corporation
Representative: Satoshi Miura, President and CEO
(Code No.: 9432, First section of Tokyo, Osaka and Nagoya Stock Exchanges and
Fukuoka and Sapporo Stock Exchanges)
NOTICE REGARDING THE LAUNCH OF A FRIENDLY OFFER IN THE U.S.
BY NTT DATA CORPORATION'S SUBSIDIARY FOR INTELLIGROUP, INC. SHARES
NTT DATA CORPORATION ("NTT DATA"), a subsidiary of Nippon Telegraph and
Telephone Corporation ("NTT"), has announced that NTT DATA and Intelligroup,
Inc., a U.S.-based IT service company (CEO: Vikram Gulati, Head Office:
Princeton, New Jersey, U.S.A.; "Intelligroup") have entered into a merger
agreement pursuant to which Mobius Subsidiary Corporation, a wholly-owned
subsidiary of NTT DATA, will make a cash tender offer for all of Intelligroup's
common shares and subsequently acquire any remaining Intelligroup shares through
a cash merger. For more details, please see the attached press release by NTT
DATA.
For further inquiries, please contact:
Kazu Yui or Ken Araki
Investor Relations Office
Finance and Accounting Department
Nippon Telegraph and Telephone Corporation
Phone: +81-3-5205-5581
Fax: +81-3-5205-5589
June 14, 2010
For Immediate Release
NTT DATA's subsidiary to launch a friendly offer in the
U.S. for Intelligroup, Inc. shares
NTT DATA CORPORATION, a Japanese IT company (hereafter, "NTT DATA") and
Intelligroup, Inc. a US-based IT service company (CEO: Vikram Gulati, Head
Office: Princeton, New Jersey, USA, hereafter "Intelligroup") today announced
that they have entered into a merger agreement pursuant to which Mobius
Subsidiary Corporation, a wholly-owned subsidiary of NTT DATA, will make a cash
tender offer for all of Intelligroup's common shares and subsequently acquire
any remaining Intelligroup shares through a cash merger (hereafter, the
"Transaction"). The Transaction was unanimously approved by the Boards of
Directors of Intelligroup and NTT DATA. Concurrently with this release, NTT DATA
is announcing the tender offer in the United States pursuant to U.S. tender
offer rules. Furthermore, this transaction does not fall under the definition of
a tender offer as stated in Article 27- 2 (1) of the Financial Instruments and
Exchange Act, and is subject to customary regulatory approvals and certain
closing conditions.
1. Purpose of the Transaction
NTT DATA and its subsidiaries (hereafter, the "Group") have focused on improving
and strengthening its international presence, in order to support the IT-related
needs of clients who are developing their businesses globally. The purpose of
this tender offer is to further contribute to such efforts of the Group.
Intelligroup is an enterprise applications systems integrator providing
consulting, implementation, testing, application management, infrastructure
management, and other IT services primarily related to SAP and Oracle
applications for global corporations. Intelligroup has developed industry award
winning ERP-related tools and pre-configured, vertical specific solutions that
reduce costs and deliver quick return on investment for customers. Intelligroup
is a services partner of SAP and Oracle in multiple regions, and is featured in
leading IT analysts' ERP and outsourcing reports. Intelligroup currently
provides SAP, Oracle and related services to major corporations located in the
U.S., UK, Denmark, Japan, India and the Middle East.
The transaction would give NTT DATA access to Intelligroup's blue-chip client
base and specialized knowledge of SAP and Oracle. NTT DATA would also benefit
from Intelligroup's deep industry experience and solutions focused on the life
sciences, high-tech and discrete manufacturing, and consumer packaged goods
verticals and its efficient global delivery model, enabled by world-class
delivery centers in India. Furthermore, the transaction would result in better
service for Intelligroup's and NTT DATA's global client bases, through
coordination and cooperation with NTT DATA global and local affiliates.
Vikram Gulati, Chief Executive Officer of Intelligroup, said, "NTT DATA's size
and global IT capabilities including data centers and cloud computing enhance
significantly our ERP solution capability and also allow us to offer total
outsourcing solutions. It enables us to offer enhanced vertical offerings, and
greater geographic coverage to our customers. Further, this allows us to
leverage the financial strength of NTT DATA which enables us to make greater and
more long term investments in the business. The synergy between the two firms
creates a formidable force that will enable us to win in the marketplace."
NTT DATA decided to launch the tender offer in the belief that the Transaction
will contribute greatly to the growth of both NTT DATA and Intelligroup's
businesses.
2. Outline of the Tender Offer
(1) Offeror
Mobius Subsidiary Corporation
In connection with the Transaction, NTT DATA's wholly owned subsidiary, NTT
DATA INTERNATIONAL L.L.C. (Head Office: New York City, New York, hereafter
"NDI") has established a wholly owned merger subsidiary, Mobius Subsidiary
Corporation (Head Office: Newark, New Jersey, hereafter "Mobius"). Following
completion of the tender offer, Mobius will merge with and into Intelligroup,
and Intelligroup will become a wholly owned subsidiary of NDI.
(2) Tender Offer Target
?Company Name :Intelligroup, Inc.
?Business Description :Consulting, Systems Integration, Software
Development, Licensing, Outsourcing
?Established :1987
?Headquarter :5 Independence Way, Suite #220 Princeton, NJ
08540
?Representative :Vikram Gulati , Chief Executive Officer
?Listed Stock Exchange:OTC Bulletin Board
?Capital :USD 413,000 (JPY 37mn)
?Shares Outstanding :41,252,888 common shares (As of June 3, 2010)
?Fiscal Year Ending :December 31
?Relationship with NTT DATA:NTT DATA and Intelligroup do not have any capital,
personal or transactional relationships
?Number of Employees :2,101 (As of December 31, 2009)
?Operating Performance in Recent Fiscal Year:
(USD '000)
+------------------+-------------------+------------------+
| Fiscal Year | 2008 | 2009 |
+------------------+-------------------+------------------+
| Revenue | 157,101 | 126,518 |
+------------------+-------------------+------------------+
| Net Income | 6,689 | 10,800 |
+------------------+-------------------+------------------+
| Total Assets | 60,230 | 67,403 |
+------------------+-------------------+------------------+
| Net Assets | 35,042 | 46,304 |
+------------------+-------------------+------------------+
Reference (in JPY)
(JPY mn)
+------------------+-------------------+------------------+
| Fiscal Year | 2008 | 2009 |
+------------------+-------------------+------------------+
| Revenue | 14,139 | 11,387 |
+------------------+-------------------+------------------+
| Net Income | 602 | 972 |
+------------------+-------------------+------------------+
| Total Assets | 5,421 | 6,066 |
+------------------+-------------------+------------------+
| Net Assets | 3,154 | 4,167 |
+------------------+-------------------+------------------+
(Note) Exchange rate: USD 1=JPY 90 (same rate used for all further data)
(3) Tender Offer Period
The tender offer will commence within 6 business days following the date of the
merger agreement (June 14, 2010 (Eastern Daylight Time in the U.S.) and will
remain open for 20 business days unless the offer is extended.
(4) Tender Offer Price
USD 4.65 per share
(JPY 418.5 per share)
(5) Total Capital Required
Approximately USD 199 million
The total required capital is calculated by multiplying the number of total
outstanding shares of Intelligroup (on a fully diluted basis) and the offer
price indicated in (4).
(6) Minimum Number of Shares to be Purchased
NTT DATA will purchase the tendered shares if all the conditions of the tender
offer are satisfied or waived, including that the number of tendered shares is
equal to at least a majority of the total outstanding shares of Intelligroup's
outstanding common stock on a fully diluted basis.
(7) Announcement Date of Commencement of Tender Offer
Announcement for purposes of the United States Securities and Exchange Act will
be made in the United States in accordance with U.S. tender offer regulations;
therefore a separate announcement in Japan will not be made.
3. Change in NTT DATA's Ownership of Intelligroup Stock as a Result of the
Tender Offer
Ownership prior to tender offer and merger: -
Ownership after the tender offer and merger: 100.0%
After the expiration of thetender offer, Mobius will merge with and into
Intelligroup through a cash merger and, as the surviving company, Intelligroup
will become a wholly owned subsidiary of NDI. The offer price in the subsequent
cash merger will be the same as the initial tender offer price of USD 4.65per
share.
4. Approval from Board of Directors of Intelligroup
The transaction has been unanimously approved by the Board of Directors of
Intelligroup as of June 13, 2010 (U.S. time)
5. Impact on Earnings
Upon successful completion of the tender offer and merger, Intelligroup will
become a consolidated subsidiary of NTT DATA.
Forward Looking Statements
This announcement contains forward-looking statements. Forward-looking
statements are expressed by phrases such as
"thinks,""expects,""plans,""foresees,""intends,""should,""predicts,""future,"and
other similar expressions, or statements regarding strategies, goals or
purposes. There is a possibility that, due to various factors, the
forward-looking statements contained in this press release and the actual
results could differ greatly, including but not limited to factors such as (1)
the macro level environment or the competitive landscape of the IT industry, (2)
risks and certain restrictions relating to regulations or litigation, (3)
changes in applicable regulations, (4) changes to tax law or other laws, or the
effects of changes to the economy in general, (5) risk that conditions to
closing will not be met, (6) risk that necessary regulatory approvals will not
be obtained, or approvals are obtained with unexpected conditions, or (7) other
risks associated with the execution of the transaction.
The tender offer for the outstanding common stock of Intelligroup referred to in
this press release has not yet commenced. This press release is neither an offer
to purchase nor a solicitation of an offer to sell any securities. The
solicitation and the offer to buy shares of Intelligroup common stock will be
made pursuant to an offer to purchase and related materials that Mobius intends
to file with the U.S. Securities and Exchange Commission. The tender offer
statement (including an offer to purchase, a related letter of transmittal and
other offer documents), and the solicitation/recommendation statement which will
be filed by Intelligroup will contain important information that should be read
carefully and considered before any decision is made with respect to the tender
offer. These materials will be sent free of charge to all stockholders of
Intelligroup. In addition, all of these materials will be available at no charge
from the U.S. Securities and Exchange Commission through its web site at
http://www.sec.gov.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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