Aladdin Knowledge Systems Rejects Vector Capital's Unsolicited Proposal3 Sep, 2008
Aladdin Knowledge Systems Rejects Vector Capital's Unsolicited Proposal
Tel Aviv, Israel (August 27, 2008) - Aladdin Knowledge Systems Ltd. (NASDAQ: ALDN), an information security leader specializing in authentication, software DRM and content security, today announced that its Board of Directors, after a thorough review with the assistance of its financial and legal advisors, has determined that the unsolicited proposal from affiliates of Vector Capital to acquire all of the outstanding ordinary shares of the Company for $13.00 per share in cash significantly undervalues the Company and its prospects for the future. The Board has also evaluated Vector Capital's alternative proposal to acquire Aladdin's Digital Rights Management (DRM) business for $125 million to $135 million and has determined that this proposal is also not in the best interest of the shareholders.
"The Aladdin Board carefully considered Vector Capital's unsolicited proposals and unanimously determined that such proposals are not in the best interests of Aladdin's shareholders," said Yanki Margalit, Chairman and CEO of Aladdin Knowledge Systems. "We believe that these unsolicited proposals are opportunistic, significantly undervalue Aladdin, and do not fully recognize the value of our Company or its DRM business. The Board is committed to acting in the best interests of its shareholders in evaluating opportunities to enhance shareholder value.
"As part of our review, the Board and its advisors evaluated the Vector Capital proposals in the context of the Company's recent financial performance, our current business plan as well as additional alternatives available to the Company which would enable it to enhance shareholder value," Mr. Margalit continued. "We are confident that, through execution of its strategy, Aladdin will create substantially greater value for shareholders than either of Vector Capital's proposals. Vector Capital fails to recognize the intrinsic value of the Company's business and strategic initiatives."
Credit Suisse Securities (USA) LLC is serving as financial advisor to Aladdin. Kramer Levin Naftalis & Frankel LLP is serving as U.S. legal counsel and Herzog, Fox & Ne'eman is serving as Israeli counsel to the Company.