AlphaSmart to Merge with Renaissance Learning
AlphaSmart today announced that it has reached a definitive agreement to merge with Renaissance Learning, Inc., a leading provider of learning information systems and school improvement programs for pre-K–12 schools. AlphaSmart and Renaissance Learning expect that this merger will enable the combined companies to offer a unique suite of writing products, enhance some of Renaissance Learning's other software products and broaden the market channels for the AlphaSmart product lines. Renaissance Learning plans to operate AlphaSmart as a wholly-owned subsidiary and retain the AlphaSmart brand.
Under the agreement, unanimously approved by the boards of directors of both companies, each AlphaSmart stockholder will receive $3.75 per share. The transaction is intended to be structured as a tax-free reorganization and is valued at approximately $57 million. AlphaSmart stockholders will have the option to be paid in cash, stock or some combination of the two, subject to pro-ration so that the total consideration paid will aggregate no more than 45% stock and no less than 55% cash. The merger, which is expected to be completed in the second quarter of 2005, is subject to approval by AlphaSmart stockholders, government regulatory review, and other customary closing conditions described in the definitive agreement. Voting agreements supporting the merger have been executed by AlphaSmart stockholders who hold approximately 60% of the outstanding shares, including its three founders.
“The addition of AlphaSmart’s exceptional product line and talented professional staff will strengthen and diversify Renaissance Learning’s position as a leading provider of learning information systems to schools,” said John Hickey, president and chief executive officer of Renaissance Learning. “Together, we will be able to provide unique breakthrough solutions to help educators develop student writing skills along with strengthening other Renaissance solutions where limited computer access is a bottleneck to daily program use. In addition to the merger providing substantial growth potential for the combined companies, we expect to achieve annual savings of at least $1 million from the reduction of redundant public company and other costs.”
“By offering AlphaSmart portable computer-companion products with Renaissance Learning software, we will be able to help K–12 districts leverage the use of their existing classroom computers, thereby increasing the value derived from their technology investment,” said Ketan D. Kothari, chairman and chief executive officer of AlphaSmart. “Our solutions are highly complementary, and we expect that this merger will help grow the revenues of the combined companies and accelerate learning of writing and other subjects.”
AlphaSmart's Palm OS license with PalmSource extends through 2008.
About AlphaSmart, Inc.
AlphaSmart, Inc. is a provider of affordable, portable personal learning solutions for the K–12 classroom. Its portable computer-companion products are used by students to enhance writing, keyboarding and comprehension, and have been adopted by more than 8,000 school districts in the United States and other countries. Based in Los Gatos, California, the company was founded in 1992 by former Apple Computer engineers.
Renaissance Learning, Inc.
Renaissance Learning, Inc. is a leading provider of research-based learning information systems software, school improvement programs, teacher training, and consulting. Adopted by more than 67,000 schools, Renaissance Learning information technology products give students and teachers continuous constructive feedback that helps motivate students, dramatically accelerate learning, improve test scores, and help students master all standards, while reducing teacher paperwork. Renaissance Learning has six U.S. locations and subsidiaries in Australia, Canada, India, and the United Kingdom.
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