On Monday, Pivotal formally threw out the previously recommended offer from Oak Investment Partners and committed itself to the CDC Software Corp bid. The much postponed shareholder meeting at which shareholders were due to vote on the Oak offer and was most recently rescheduled for Monday, has been adjourned permanently.
The CDC offer is subject to approval by the Supreme Court of British Columbia, and the Pivotal shareholders and the two entities expect to hold an EGM in February and close the transaction the same month.
Under the terms of its previous agreement with Oak Investment Partners, Pivotal is required to pay a $1.5m break-up fee to Talisma, an Oak-owned company that Oak planned to merge with Pivotal. Chinadotcom has loaned Pivotal $2m to cover the cost of the fee and to fund working capital.
CDC has offered shareholders a choice of transactions based on a cash offer of $2.00 per share, or a part cash/part share alternative comprising $1.00 cash and $1.14 in Chinadotcom shares which value Pivotal at $53m and $57m respectively.
What initially looked like a straightforward acquisition when Oak made its proposal in October 2003 soon became a scrum, which included CDC and CRM vendor Onyx. Accusations flew that Pivotal’s financial advisers had prevented both players from tendering formal bids, resulting in two unsolicited tenders and the commencement of an ugly period of negotiation by public press release.
Commenting on the latest decision, Eric Rosenfeld, chairman of the Special Committee of Pivotal said in statement: Although it may not have always been apparent to outsiders, every step that the Special Committee has taken throughout this process has been with the intention to maximize shareholder value for Pivotal.
This article is based on material originally produced by ComputerWire.
