Premiere Technologies Inc has finally got the deal done, announcing that it has entered into a definitive agreement to acquire fax and electronic messaging outfit Xpedite Systems Inc. The merger will be accounted for as a tax-free pooling of interests. The computer telephony company will fork over $34 dollars a share for Xpedite, after upping its offer from the original $30 bid a week earlier (CI No 3,284). Premiere says the bid was increased in response to a competing offer from the same Xpedite management group whose $200m buyout offer was declined in July (CI No 3,207). Under terms of the agreement, Xpedite common stock will be converted into a number of Premiere shares equal to $34 divided by the average trading price of the Premiere shares prior to closing, with a maximum exchange ratio of 1.25 shares of Premiere for each Xpedite share and a minimum exchange ratio of 0.867 Premiere shares for each Xpedite share. There is a provision that the merger can be terminated by Xpedite’s board if the average trading price of Premiere Common Stock is less than $24 per share. Premiere shares closed at $27.3125 on Friday, down $0.9375, while Xpedite shares rose $0.25 to $28.875. Closing of the merger – expected in the first quarter of next year – also depends upon shareholder approval, the successful consummation of Xpedite’s pending acquisition of Xpedite Systems Ltd (its UK affiliate) and regulatory approval. The combined company will have a direct sales force of over 550 people on four continents and annual sales of $400m.
