UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE
14D-9
Solicitation/Recommendation Statement
Under Section 14(d)(4) of the Securities Exchange Act of 1934
SYMMETRICOM, INC.
(Name
of Subject Company)
SYMMETRICOM, INC.
(Name
of Person Filing Statement)
Common Stock, par value $0.0001 per share
(Title of Class of Securities)
871543104
(CUSIP Number
of Class of Securities)
Ms. Elizabeth A. Fetter
President and Chief Executive Officer
2300 Orchard Parkway, San Jose, California 95131
(408) 433-0910
(Name,
address and telephone number of person authorized to receive
notices and communications on behalf of the persons filing statement)
With copies to:
Ora T. Fisher
Latham
& Watkins LLP
140 Scott Drive
Menlo Park, California 94025-3656
(650) 463-2616
x
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Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
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Attached are (i) a joint press release distributed by the Company and Microsemi Corporation on October 21, 2013; (ii) a letter, dated
October 21, 2013, from the Chief Executive Officer of the Company to employees of the Company; and (iii) slides presented to employees on October 22, 2013.
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MICROSEMI FINANCIAL CONTACT:
John W. Hohener
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Executive Vice President and CFO
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Tel: (949) 380-6100
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MICROSEMI INVESTORS:
Robert C.
Adams
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Vice President of Corporate Development
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Tel: (949) 380-6100
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SYMMETRICOM CONTACT:
Justin
Spencer
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Chief Financial Officer
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+1-408-428-7801
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Microsemi Corporation to Acquire Symmetricom, Inc.
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Strengthens Microsemis position in high-value communications timing markets
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Creates industrys largest and most complete end-to-end timing portfolio
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Expands Microsemi timing opportunities in aerospace, defense and industrial markets
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Brings scale to timing portfolio, expands customer base, drives increased content
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Delivers immediate EPS accretion and synergies
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ALISO VIEJO, Calif. and SAN JOSE, Calif.Oct. 21,
2013Microsemi Corporation (Nasdaq:MSCC)
, a leading provider of semiconductor solutions differentiated by power, security, reliability and performance, and
Symmetricom, Inc.
(Nasdaq:SYMM), a worldwide leader in precision time and
frequency technologies, announced today that they have entered into a definitive agreement to acquire Symmetricom, Inc. for $7.18 per share through a cash tender offer, representing a premium of 49 percent based on the average closing price of
Symmetricoms shares of common stock during the 90 trading days ended Oct. 18, 2013. The board of directors of Symmetricom unanimously recommends that Symmetricoms stockholders tender their shares in the tender offer. The total
transaction value is approximately $230 million, net of Symmetricoms projected cash balance at closing.
Headquartered in San Jose, Calif.,
Symmetricom is the worlds leading source of highly precise timekeeping technologies and solutions that enable next generation data, voice, mobile and video networks and services. It provides timekeeping in GPS satellites, national time
references, and national power grids as well as in critical military and civilian networks.
The acquisition of Symmetricom will create the largest
and most complete timing portfolio in the industry today, stated James J. Peterson, Microsemi president and chief executive officer. From source to synchronization to distribution, Microsemi will offer an end to end timing
solution for an expanded range of markets, driving increased dollar content opportunity and revenue growth.
The acquisition of Symmetricom by
Microsemi will create a powerful combination, said Elizabeth Fetter, Symmetricoms chief executive officer. I believe Microsemi is the ideal company to leverage Symmetricoms technology and capabilities further into the
communications market along with the scale to accelerate the adoption of the companys innovative new chip scale atomic clock (CSAC) technology into broader markets.
Microsemi expects significant synergies from this immediately accretive transaction. Based on current assumptions, Microsemi expects the acquisition to be
$0.22 to $0.25 accretive in its first full calendar year ending December 2014.
Microsemi reaffirms its fiscal fourth quarter guidance included in its fiscal third quarter earnings release
issued on July 25, 2013. Microsemi currently intends to announce its fiscal fourth quarter results on Nov. 7, 2013. Further details will be forthcoming.
Tender Offer and Closing
Under the terms of the
definitive acquisition agreement, Microsemi will commence a cash tender offer to acquire Symmetricoms outstanding shares of common stock at $7.18 per share, net to each holder in cash. Upon satisfaction of the conditions to the tender offer
and after such time as all shares tendered in the tender offer are accepted for payment, the agreement provides for the parties to effect, as promptly as practicable, a merger which would result in all shares not tendered in the tender offer being
converted into the right to receive $7.18 per share in cash. The tender offer is subject to customary conditions, including the tender of at least a majority of the fully-diluted shares of Symmetricoms common stock and certain regulatory
approvals, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, and is expected to close in Microsemis fiscal first quarter, ending Dec. 29, 2013. No approval of the
stockholders of Microsemi is required in connection with the proposed transaction. Terms of the agreement were unanimously approved by the boards of directors of both Microsemi and Symmetricom.
Under the terms of the merger agreement, Symmetricom may solicit superior proposals from third parties for a go shop period that extends through
Nov. 8, 2013. It is not anticipated that any developments will be disclosed with regard to this process unless and until Symmetricoms board of directors makes a decision to pursue a potential superior proposal. Jefferies LLC, which is acting
as Symmetricoms financial adviser, will assist Symmetricom with Symmetricoms go-shop process. There are no guarantees that this process will result in a superior proposal. The merger agreement provides Microsemi with a customary right to
match a superior proposal. The agreement also provides for certain termination fees payable to Microsemi in connection with the termination of the agreement in certain circumstances.
Jefferies LLC is acting as financial adviser and Latham & Watkins LLP is acting as legal adviser to Symmetricom. Morgan Stanley provided a fairness
opinion to Microsemi and OMelveny & Myers LLP is acting as legal adviser to Microsemi.
Conference Call
Microsemi will host a conference call, solely to discuss details of the transaction. A live webcast relating to the transaction will be available in the
Investors section of Microsemis website at
www.microsemi.com
in advance of the conference call.
Conference call date: Oct. 21,
2013
Time: 1:45 p.m. PDT (4:45 p.m. EDT)
Dial-in numbers:
U.S. 877-264-1110; international 706-634-1357
Passcode: 90095902
A webcast of the conference call will also be available in the Investors section of Microsemis website at
www.microsemi.com
.
About Microsemi
Microsemi Corporation (Nasdaq: MSCC) offers a comprehensive portfolio of semiconductor and system solutions for communications, defense & security,
aerospace and industrial markets. Products include high-performance and radiation-hardened analog mixed-signal integrated circuits, FPGAs, SoCs and ASICs; power management products; timing and voice processing devices; RF solutions; discrete
components; security technologies and scalable anti-tamper products; Power-over-Ethernet ICs and midspans; as well as custom design capabilities and services. Microsemi is headquartered in Aliso Viejo, Calif., and has approximately 3,000
employees globally. Learn more at
www.microsemi.com
.
Microsemi and the Microsemi logo are registered trademarks or service marks of Microsemi
Corporation and/or its affiliates. Third-party trademarks and service marks mentioned herein are the property of their respective owners.
About
Symmetricom, Inc.
Symmetricom (SYMM), a world leader in precise time solutions, sets the worlds standard for time. The company generates,
distributes and applies precise time for the communications, aerospace/defense, IT infrastructure and metrology industries. Symmetricoms customers, from communications service providers and network equipment manufacturers to governments and
their suppliers worldwide, are able to build more reliable networks and systems by using the companys advanced timing technologies, atomic clocks, services and solutions. All products support todays precise timing standards, including
GPS-based timing, IEEE 1588 (PTP), Network Time Protocol (NTP), Synchronous Ethernet and DOCSIS
®
timing. Symmetricom is based in San Jose, California, with offices worldwide. For more
information, visit:
http://www.symmetricom.com
or join the dialogue at
http://www.twitter.com/symmetricom
.
Microsemi Safe Harbor
Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking
statements based on current expectations or beliefs, as well as a number of assumptions about future events, and these statements are subject to factors and uncertainties that could cause actual results to differ materially from those described in
the forward-looking statements. The reader is cautioned not to put undue reliance on these forward-looking statements, which are not a guarantee of future performance and are subject to a number of uncertainties and other factors, many of which are
outside the control of Microsemi and Symmetricom. The forward-looking statements in this release address a variety of subjects including, for example, the expected date of closing of the acquisition, the potential benefits of the merger, including
the potentially accretive and synergistic benefits, Microsemis revenue and earnings guidance, and any other statements of belief or about the Microsemis plans, beliefs or expectations. The following factors, among others, could cause
actual results to differ materially from those described in these forward-looking statements: the risk that Symmetricoms business will not be successfully integrated with Microsemis business or complement its products, including product
mix and acceptance, gross margins and operational and other cost synergies; costs associated with the merger, tender offer and financing; the unsuccessful completion of the tender offer; matters arising in connection with the parties efforts
to comply with and satisfy applicable regulatory approvals and closing conditions relating to the transaction; increased competition and technological changes in the industries in which Microsemi and Symmetricom compete; Microsemis reliance on
government contracts for a portion of its sales, including impacts of the recent federal
government shutdown; Microsemis failure to continue to move up the value chain in its customer offerings; continued negative or worsening worldwide economic conditions or market
instability; downturns in the highly cyclical semiconductor industry; intense competition in the semiconductor industry and resultant downward price pressure; inability to develop new technologies and products to satisfy changes in customer demand
or the development by the companys competitors of products that decrease the demand for Microsemis products; unfavorable or declining conditions in end markets; inability of Microsemis compound semiconductor products to compete
successfully with silicon-based products; production delays related to new compound semiconductors; variability of the companys manufacturing yields; the concentration of the factories that service the semiconductor industry; delays in
beginning production, implementing production techniques, resolving problems associated with technical equipment malfunctions, or issues related to government or customer qualification of facilities; potential effects of system outages; the effect
of events such as natural disasters and related disruptions on our operations; inability by Microsemi to fulfill customer demand and resulting loss of customers; variations in customer order preferences; difficulties foreseeing future demand; rises
in inventory levels and inventory obsolescence; potential non-realization of expected orders or non-realization of backlog; failure to make sales indicated by the companys book-to-bill ratio; risks related to the companys international
operations and sales, including availability of transportation services, political instability and currency fluctuations; increases in the costs of credit and the availability of credit or additional capital only under more restrictive conditions or
not at all; unanticipated changes in Microsemis tax provisions, results of tax examinations or exposure to additional income tax liabilities; changes in generally accepted accounting principles; principal, liquidity and counterparty risks
related to Microsemis holdings in securities; environmental or other regulatory matters or litigation, or any matters involving contingent liabilities or other claims; the uncertainty of litigation, the costs and expenses of litigation, the
potential material adverse effect litigation could have on Microsemis business and results of operations if an adverse determination in litigation is made, and the time and attention required of management to attend to litigation; uncertainty
as to the future profitability of acquired businesses, and delays in the realization of, or the failure to realize, any accretion from acquisition transactions; any circumstances that adversely impact the end markets of acquired businesses; and
difficulties in closing or disposing of operations or assets or transferring work, assets or inventory from one plant to another. In addition to these factors and any other factors mentioned elsewhere in this news release, the reader should refer as
well to the factors, uncertainties or risks identified in the companys most recent Form 10-K and all subsequent Form 10-Q reports filed by Microsemi with the SEC. Additional risk factors may be identified from time to time in Microsemis
future filings. The forward-looking statements included in this release speak only as of the date hereof, and Microsemi does not undertake any obligation to update these forward-looking statements to reflect subsequent events or circumstances.
Guidance is provided only on a non-GAAP basis due to the inherent difficulty of forecasting the timing or amount of certain items that have been excluded from the forward-looking non-GAAP measures, and a reconciliation to the comparable GAAP
guidance has not been provided because certain factors that are materially significant to Microsemis ability to estimate the excluded items are not accessible or estimable on a forward-looking basis.
Symmetricom Safe Harbor Statement
This press
release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and is subject to the safe harbor created by
those sections. These forward-looking statements address a variety of subjects including, for example, the expected date of closing of the
acquisition and any other statements of belief or about the Symmetricoms plans, beliefs or expectations. The statements in this press release are made as of the date of this press
release, even if subsequently made available by Symmetricom on its website or otherwise. Symmetricom expressly disclaims any obligation to update or revise any forward-looking statement contained herein, whether as a result of a change in its
expectations, a change in any events, conditions or circumstances on which a forward-looking statement is based, or otherwise. Symmetricoms actual results could differ materially from those projected or suggested in these forward-looking
statements. Factors that could cause future actual results to differ materially from the results projected in or suggested by such forward-looking statements include, but are not limited to, risks associated with uncertainties as to the timing
of the tender offer and the subsequent merger; uncertainties as to how many of Symmetricoms stockholders will tender their shares of common stock in the tender offer; the possibility that competing offers or acquisition proposals will be made;
the possibility that various conditions to the consummation of the offer or the merger may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the offer or the
merger; the effects of disruption from the transactions on Symmetricoms business and the fact that the announcement and pendency of the transactions may make it more difficult to establish or maintain relationships with employees, suppliers
and other business partners; the risk that stockholder litigation in connection with the tender offer or the merger may result in significant costs of defense, indemnification and liability; and other risks and uncertainties pertaining to the
business of Symmetricom, including risks relating to general economic conditions in the markets we address and the telecommunications and government markets in general, risks related to the development of our new products and services, reliance on
our contract manufacturer, the effects of increasing competition and competitive pricing pressure, uncertainties associated with changing intellectual property laws or misappropriation of intellectual property, developments in and expenses related
to litigation, the inability to obtain sufficient amounts of key components, the rescheduling or cancellation of key customer orders, the loss of a key customer, the effects of new and emerging technologies, the risk that excess inventory may result
in write-offs, price erosion and decreased demand, fluctuations in the rate of exchange of foreign currency, changes in our effective tax rate, market acceptance of our new products and services, technological advancements, undetected errors, design
flaws, defects in our products or start-up manufacturing difficulties, the risks associated with our international sales, potential short-term investment losses and other risks due to credit market dislocation, geopolitical risks and risk of
terrorist activities, the risks associated with attempting to integrate other companies and businesses we acquire, and the risk factors listed from time to time in Symmetricoms reports filed with the Securities and Exchange Commission,
including the annual report on Form 10-K for the fiscal year ended June 30, 2013 and subsequent Forms 10-Q and 8-K.
Notice to Investors
The tender offer for the outstanding shares of common stock of Symmetricom has not yet commenced. This press release is for informational purposes only and no
statement in this press release is an offer to purchase or a solicitation of an offer to sell securities. At the time the tender offer is commenced, Microsemi Corporation and a wholly-owned subsidiary of Microsemi Corporation will file a tender
offer statement on Schedule TO with the Securities and Exchange Commission, and Symmetricom will file a
solicitation/recommendation statement on Schedule 14D-9 with respect to the tender offer. The tender offer statement (including an offer to purchase, a related letter of transmittal and other
offer documents) and the solicitation/recommendation statement will contain important information that should be read carefully before any decision is made with respect to the tender offer. Such materials will be made available to Symmetricoms
shareholders at no expense to them. In addition, such materials (and all other offer documents filed with the SEC) will be available at no charge on the SECs website at
www.sec.gov
.
MSCCIR
Source: Microsemi Corporation
October 21, 2013
Symmetricom Employees,
Today, Symmetricom issued a joint news
release with Microsemi Corporation announcing that the two companies have entered into an agreement pursuant to which, among other things, Microsemi will commence a tender offer for all of the outstanding shares of Symmetricoms common stock
for a purchase price of $7.18 per share. We anticipate that the transaction would close sometime before the end of the calendar year. A copy of the news release can be found at:
http://investor.microsemi.com/releasedetail.cfm?ReleaseID=798778
For this transaction to be closed, certain conditions, including shareholders tendering a sufficient number of shares and receipt of certain regulatory
approvals, must be satisfied. Until that time, Symmetricom will continue to operate as a fully independent company.
Todays news reflects the strong
market position, capabilities, and technology offered by Symmetricom.
For now, its business as usual and as such, it is critical we all
maintain our day-to-day responsibilities. With your help, we have been successfully managing through our strategic restructuring plan, improving our execution and focus, and delivering valuable solutions to the market. Indeed, we believe
Microsemis interest in Symmetricom reflects our strength and upside potential of the business.
Todays announcement may attract attention to
our company from outside parties and the media, and it is important all communication comes from the executive team. Should you receive any external inquiries, please forward them to Phil Bourekas or Justin Spencer.
I have asked Bill Minor to organize a company-wide meeting for tomorrow morning. Please make every reasonable effort to attend, and I will try to answer
questions at that time. In the meantime, feel free to share questions or concerns with your business or executive leaders.
Thank you for your continued
support.
Sincerely,
Liz Fetter
Chief Executive Officer
Important Information and Where To
Find It
The tender offer described herein (the Offer) has not yet commenced. No statement in this document is an
offer to purchase or a solicitation of an offer to sell any shares of the common stock of Symmetricom, Inc. (Symmetricom) or any other securities. At the time the Offer is commenced, Microsemi Corporation (Microsemi) and
PETT Acquisition Corp., a wholly owned subsidiary of Microsemi, will file a tender offer statement on Schedule TO with the United States Securities and Exchange Commission (the SEC), and Symmetricom will file a
Solicitation/Recommendation Statement on Schedule 14D-9 with the SEC. Any offers to purchase or solicitations of offers to sell may be made only pursuant to such tender offer statement. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ BOTH
THE TENDER OFFER STATEMENT (INCLUDING AN OFFER TO PURCHASE, A LETTER OF TRANSMITTAL AND RELATED DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT REGARDING THE OFFER WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. These materials, when prepared and ready for release, will be made available to Symmetricoms stockholders at no expense to them. In addition, investors and securityholders may obtain a free copy of such materials (when
available) and other documents filed with the SEC at the website maintained by the SEC at
www.sec.gov
or by directing such requests to the Information Agent for the tender offer, which will be named in the tender offer statement.
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October 22,
2013
All-Hands Meeting
Confidential © Copyright 2013
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2
Confidential © Copyright 2013
Agenda
Announcement by Microsemi to Acquire Symmetricom
About Microsemi
Symmetricom Priorities
Q&A
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3
Announcement
Microsemi
to commence a tender offer to purchase SYMMs
common stock
Purchase price: $7.18
Expect deal to be completed by December 31, 2013
SYMM may solicit superior proposals thru November 8, 2013
Confidential © Copyright 2013
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About
Microsemi
* Following slides taken from the Microsemi Corporate
Presentation
Confidential © Copyright 2013
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8
Confidential © Copyright 2013
Why Symmetricom?
High value communications timing market
Provides end-to-end portfolio
Opportunities in aerospace, defense and industrial markets
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9
Confidential © Copyright 2013
Symmetricom Priorities
Communication to employees, customers, suppliers and partners
has begun
Critical we deliver our Q2 objectives
Business-as-usual for employees
Keep Calm and Carry-On
United Kingdom 1939
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Confidential © Copyright 2013
Important Information and Where to find it
The
tender
offer
described
herein
(the
Offer)
has
not
yet
commenced.
No
statement
in
this
document is an offer to purchase or a solicitation of an offer to sell any shares of the
common
stock
of
Symmetricom,
Inc.
(Symmetricom)
or
any
other
securities.
At
the
time
the
Offer
is
commenced, Microsemi Corporation (Microsemi) and PETT Acquisition Corp., a wholly
owned
subsidiary of Microsemi, will file a tender offer statement on Schedule TO with
the United States
Securities and Exchange Commission (the SEC), and
Symmetricom will file a
Solicitation/Recommendation
Statement
on
Schedule
14D-9
with
the
SEC.
Any
offers
to
purchase
or solicitations of offers to sell may be made only pursuant to such tender offer
statement.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ BOTH THE TENDER OFFER
STATEMENT (INCLUDING AN OFFER TO PURCHASE, A LETTER OF TRANSMITTAL AND RELATED
DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT REGARDING THE OFFER
WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION.
These materials, when prepared and ready for release, will be made available to
Symmetricoms
stockholders
at
no
expense
to
them.
In
addition,
investors
and
securityholders
may obtain a free copy of such materials (when available) and other documents filed with the
SEC
at
the
website
maintained
by
the
SEC
at
www.sec.gov
or
by
directing
such
requests
to
the
Information Agent for the tender offer, which will be named in the tender offer
statement.
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Confidential
© Copyright 2013
Q & A
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