Filing Reveals Background on the Elevation Deal
In preparing for its recently announced recapitalization deal with Elevation Partners, Palm has filed a regulatory proxy statement with the SEC. The proxy statement reveals some interesting background information about how the deal came about. The filling also reveals that over the past year a number of different firms have explored purchasing Palm outright, including Elevation.
According to the statement, from January to April of this year Palm met with several potential strategic partners and private equity firms to discuss a potential 'business combination transactions'. Palm goes on to disclose that Elevation Partners initially made an offer to acquire 100% of Palm to take the company private. In the end Elevations unnamed equity partner backed out of the deal, and the current offer to acquire 25% of the company was put forward.
Portions of the statement read:
Elevation was among the parties who had expressed serious interest in pursuing an acquisition transaction. On January 22, 2007, Palm first received a preliminary proposal from Elevation to acquire 100% of our outstanding shares for cash. This proposal was contingent upon obtaining sufficient debt financing, as well as Elevation securing additional equity financing from one or more partners. Discussions and diligence continued with Elevation through February and March 2007. On March 26, 2007, Elevation and a separate private equity firm submitted a joint letter with an offer to buy 100% of our shares for $19-$20 per share. On March 29, 2006, Elevation informed us that its private equity partner no longer wished to pursue an acquisition transaction.
On April 16, 2007 Elevation proposed a revised transaction to us that involved an investment by Elevation of $325 million and a distribution to our stockholders of $9.00 per share. Together with a summary term sheet outlining the terms of the investment, Elevation delivered to us a draft commitment letter from JP Morgan with respect to up to a $400 million term loan facility and up to $40 million revolving credit facility, which funds would finance in part the $9.00 per share cash distribution to stockholders. Elevationís proposal emphasized the capabilities and potential contributions of Elevation and Elevationís principals, including Fred Anderson, former Chief Financial Officer of Apple, and Roger McNamee, a long-time investor in technology companies. Elevation also indicated that it had identified Jon Rubinstein as a key senior executive candidate to complement our executive team, and that Mr. Rubinsteinís employment with us would be a condition of Elevationís investment.
You can find the full proxy statement here.
Article Comments(13 comments)
- I got one -Tuckermaclain
- I got one -Tuckermaclain
- RE: Don't we have this already? -Tuckermaclain
- RE: Palm brand will return in 2018, with devices built by TCL -richf
- RE: Palm brand will return in 2018, with devices built by TCL -dmitrygr
- Palm phone on HDblog -palmato
- Palm PVG100 -hgoldner
- RE: Like Deja Vu -PacManFoo