Insight Enterprises (Nasdaq:NSIT), an Intelligent Technology
Solutions™ provider (“Insight” or “the Company”), and Datalink
Corporation (Nasdaq:DTLK), a leading provider of IT services and
enterprise data center solutions (“Datalink”), have entered into a
definitive merger agreement under which Insight will acquire
Datalink for $11.25 per share in cash, representing a 19% premium
to Datalink’s closing share price on November 4, 2016. The
transaction implies an equity purchase price of approximately $258
million and an enterprise value of approximately $196 million (net
of cash and debt acquired).
Datalink is a premier provider of IT services and solutions
headquartered near Minneapolis, Minn., with offices in 35 locations
in the United States and approximately 570 teammates.
Datalink delivers value to Fortune 1000 and public sector clients
by providing complete IT solutions that include hardware, software
and services to create business impact for their clients.
Insight expects to achieve approximately $20 million in run-rate
cost savings within two years after closing, primarily related to
corporate efficiencies, duplicative functions and IT system
integration. The transaction is expected to be accretive to
2017 adjusted earnings per share (excluding transaction and
integration expenses).
“The data center is at the core of our
clients’ strategic investments. With the increasing number of
options from converged to hyper-converged solutions as well as
hybrid cloud options, the landscape has become more complex and
clients are looking for help as they evaluate alternatives.
The acquisition of Datalink is a significant step in strengthening
the foundation of our data center practice as we add the expertise
and depth of the Datalink team to our portfolio. We are
excited about the combination and look forward to welcoming the
Datalink team to our organization,” said Ken Lamneck, CEO of
Insight.
“The strength of Datalink’s world-class data center capabilities
combined with Insight’s scale and breadth of offerings will bolster
our ability to deliver solutions for complex business problems
across an expanded footprint of clients. This combination
gives our team significant new opportunities to help more
organizations elevate and transform their IT,” said Shawn O’Grady,
Chief Operating Officer of Datalink.
The combination of the two organizations brings a full
complement of end-to-end technology solutions in supply chain,
application and data center architecture, implementation and
managed solutions. “Our clients, partners and teammates will
experience exciting opportunities for growth and development as a
result of this acquisition,” said Steve Dodenhoff, president of
Insight’s US business.
“Our decision to join forces with Insight is based on our shared
commitment to deliver best in class technology, operations and
services to meet our clients’ need for IT transformation. Our
enterprise solutions platform, sophisticated offerings, talented
professionals and our client base will bring a rich dimension to
the Insight organization,” said Paul Lidsky, CEO of Datalink.
Terms and Financing
The transaction is subject to certain closing conditions,
including regulatory approvals and approval of Datalink’s
shareholders, and is expected to close in the first quarter of
2017.
Insight intends to finance the transaction through a combination
of cash on hand and borrowings under its existing revolving credit
facilities.
Advisors
J.P. Morgan Securities LLC is acting as financial advisor to
Insight. Insight’s legal advisor is Sullivan & Cromwell
LLP.
Raymond James & Associates is acting as financial advisor
and Faegre Baker Daniels LLP is acting as legal advisor to
Datalink.
Conference CallInsight will host a conference
call and webcast today, November 7, at 8:30 a.m. ET to discuss the
transaction.
The live conference call is available by dialing (877) 402-8904
from the U.S. or (678) 809-1029 from outside the U.S. and entering
conference code 3625042. Supporting materials, as well as a
link to an audio webcast of the conference call, will be available
at http://nsit.client.shareholder.com/index.cfm.
A replay of the conference call will be available for a limited
time beginning approximately one hour after completion of the
conference call and can be accessed via the Insight website at
http://nsit.client.shareholder.com/index.cfm.
Forward Looking Statements
Cautionary Note Regarding Forward-Looking
Statements
Certain statements contained in this communication may
constitute “forward-looking statements.” Forward-looking
statements can usually be identified by the use of words such as
“aim,” “anticipate,” “believe,” “continue,” “could,” “estimate,”
“evolve,” “expect,” “forecast,” “intend,” “looking ahead,” “may,”
“opinion,” “plan,” “possible,” “potential,” “project,” “should,”
“will” and other expressions which indicate future events or
trends.
These forward-looking statements are based upon certain
expectations and assumptions and are subject to risks and
uncertainties. Actual results could differ materially from those
anticipated as a result of various factors, including the
following: Datalink’s shareholders may not approve the transaction;
conditions to the closing of the transaction, including receipt of
required regulatory approvals, may not be satisfied; the
transaction may involve unexpected costs, liabilities or delays;
the parties may be unable to achieve expected synergies and
operating efficiencies in the merger within the expected time
frames or at all and to successfully integrate Datalink’s
operations into those of Insight; such integration may be more
difficult, time consuming or costly than expected; revenues
following the transaction may be lower than expected; operating
costs, customer loss and business disruption (including, without
limitation, difficulties in maintaining relationships with
employees, customers, clients or suppliers) may be greater than
expected following the transaction; uncertainties surrounding the
transaction; the outcome of any legal proceedings related to the
transaction; Datalink and/or Insight may be adversely affected by
other economic, business, and/or competitive factors; risks that
the pending transaction disrupts current plans and operations; the
retention of key employees of Datalink; other risks to consummation
of the transaction, including circumstances that could give rise to
the termination of the merger agreement and the risk that the
transaction will not be consummated within the expected time period
or at all; and the other risks described from time to time in
Datalink’s and Insight’s reports filed with the Securities and
Exchange Commission (the “SEC”) under the heading “Risk Factors,”
including each company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2015, subsequent Quarterly Reports on Form
10-Q and in other of Datalink’s and Insight’s filings with the
SEC.
All forward-looking statements are qualified by, and should be
considered in conjunction with, such cautionary statements. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which such
statements were made. Except as required by applicable law, neither
Insight nor Datalink undertakes any obligation to update
forward-looking statements to reflect events or circumstances
arising after such date.
Additional Information and Where to Find It
In connection with the transaction, Datalink intends to file
relevant materials with the SEC, including a proxy statement on
Schedule 14A. Following the filing of the definitive proxy
statement with the SEC, Datalink will mail the definitive proxy
statement and a proxy card to each shareholder entitled to vote at
the special meeting relating to the transaction. Datalink
shareholders are urged to carefully read these materials (and any
amendments or supplements) and any other relevant documents that
Datalink files with the SEC when they become available because they
will contain important information. The definitive proxy
statement, the preliminary proxy statement and other relevant
materials in connection with the transaction (when they become
available), and any other documents filed by Datalink with the SEC,
may be obtained free of charge at the SEC’s website
(http://www.sec.gov), at Datalink’s investor website
(http://www.datalink.com/Investor-Information), or by writing or
calling Datalink at Datalink Corporation, 10050 Crosstown Circle,
Suite 500, Eden Prairie, Minnesota 55344 or by (952) 944-3462.
Participants in the Solicitation
Datalink and its directors and executive officers, and Insight
and its directors and officers, may be deemed to be participants in
the solicitation of proxies from Datalink’s stockholders with
respect to the transaction. Information about Datalink’s
directors and executive officers and their ownership of Datalink’s
common stock is set forth in Datalink’s proxy statement on Schedule
14A filed with the SEC on April 15, 2016. To the extent that
holdings of Datalink’s securities have changed since the amounts
printed in Datalink’s proxy statement, such changes have been or
will be reflected on Statements of Change in Ownership on Form 4
filed with the SEC. Information regarding the identity of the
participants in the proxy solicitation, and their direct or
indirect interests in the transaction, by security holdings or
otherwise, will be set forth in the proxy statement and other
materials to be filed with SEC in connection with the transaction.
Information about the directors and executive officers of Insight
is set forth in the proxy statement for Insight’s 2016 Annual
Meeting of Stockholders, which was filed with the SEC on April 5,
2016.
About Datalink
Datalink is a complete IT services and solutions provider
that helps companies transform their technology, operations, and
service delivery to meet business challenges. Combining extensive
experience, a full lifecycle of services and a comprehensive
approach to producing IT innovations that empower positive business
outcomes, Datalink delivers success across cloud IT
transformation, next generation technology, and security. For more
information, call 800.448.6314 or visit www.datalink.com.
About Insight From business and
government organizations to healthcare and educational
institutions, Insight empowers clients with "Intelligent
Technology™" solutions to realize their goals. As a Fortune
500-ranked global provider of hardware, software, cloud and service
solutions, our 5,700 teammates provide clients the guidance and
expertise needed to select, implement and manage complex technology
solutions to drive business outcomes. Through our world-class
people, partnerships, services and delivery solutions, we help
businesses run smarter. Discover more at insight.com .
NSIT-F
INSIGHT CONTACTS: INVESTORS:
HELEN JOHNSON
Insight Enterprises
TEL. (480) 333-3234
EMAIL: HELEN.JOHNSON@INSIGHT.COM
MEDIA:
AMY PROTEXTER
Insight Enterprises
TEL. (480) 409-6710
EMAIL: AMY.PROTEXTER@INSIGHT.COM
ARIEL KOUVARAS
Sloane & Company
TEL. (212) 446-1884
EMAIL: akouvaras@sloanepr.com
DATALINK CONTACTS: INVESTORS:
GREG BARNUM
Datalink Corporation
TEL. (952) 279-4816
EMAIL: Gbarnum@Datalink.Com
MEDIA:
MATT SULLIVAN
Padilla CRT
TEL. (612) 455-1709
EMAIL: MATT.SULLIVAN@PADILLACRT.COM
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