COSTA MESA, Calif. and
SUNNYVALE, Calif., Dec. 5, 2012 /PRNewswire/ -- Emulex
Corporation (NYSE: ELX), the leading provider of converged
networking solutions, and Endace Limited (LSE: EDA), a leading
supplier of network visibility infrastructure products, announced
today that Emulex has issued a Takeover Notice, under the terms of
the New Zealand Takeovers Code, pursuant to which Emulex will make
an offer to acquire all of the outstanding equity interests in
Endace in an all cash transaction. Endace is a network performance
management company that provides network monitoring appliances,
network analytics software and ultra-high speed network access
switching with 100 percent accuracy.
(Logo: http://photos.prnewswire.com/prnh/20120403/NE81278LOGO
)
Pursuant to the Takeover Notice, Emulex intends to make a cash
offer for 500 pence per share. Using
the current exchange rate of 1.61 USD
to the pound Sterling, this represents a transaction value of
approximately $130 million. The
Independent Directors of Endace have commissioned the firm of
Grant Samuel in Auckland to provide an independent adviser's
report, as required by the New Zealand Takeovers Code. The
Independent Directors unanimously support the Offer and, subject to
the Offer price being within or above the valuation range of
Grant Samuel's report, recommend
that Endace shareholders accept the Offer. Emulex has entered into
lock‐up agreements with certain Directors of Endace, including the
Chairman and co-founder Dr. Ian
Graham. Emulex has also received commitment letters from two
other Directors who are shareholders, as well as receiving
expressions of support from another founder of the business,
Selwyn Pellett. In addition,
preliminary conversations with certain institutional shareholders
of Endace have indicated general support for the proposed
transaction.
"This acquisition provides Emulex with a strategic entry point
into the network performance management space at a disruptive point
in time, as speeds move to 10Gb, making network visibility from
end-to-end a critical requirement in a converged network
environment," said Jim McCluney,
chief executive officer (CEO), Emulex. "Acquiring Endace aligns
with our software-defined convergence strategy, doubles our total
addressable market and places Emulex in another high-margin,
high-growth market. Excluding transaction related expenses, we
expect the acquisition to be neutral to our non-GAAP earnings per
share for fiscal 2013 and accretive at the beginning of fiscal
2014."
The combination of Emulex's software-defined convergence
architecture and Endace's network visibility infrastructure will
provide organizations with new and innovative ways to solve the
challenges of network complexity and ensure application-level
performance at speeds of 10Gb and beyond. Endace's ability to
record, visualize and monitor network traffic provides customers
with the ability to dynamically optimize application delivery
across the infrastructure. By combining Emulex's network
convergence adapters and Endace's network visibility capabilities,
Emulex will be the only company that can provide true end-to-end
application visibility, optimization and acceleration.
"The Endace team is excited to be joining forces with Emulex.
Our companies share a common vision and have a strong cultural
affinity. Together, we will create a new generation of network
visibility solutions and take them to a global market," said
Mike Riley, CEO, Endace. "The
combined strengths of Emulex and Endace will provide our customers
with industry-leading solutions to connect, monitor and manage
high-performance networks in the world's most demanding data center
environments."
The transaction is expected to be completed in the March
quarter, subject to certain closing conditions, including the
acceptance of the offer by the holders of 90 percent of the
outstanding shares of Endace. Emulex expects to provide more
detailed pro-forma guidance upon the closing of the
acquisition. Emulex also affirmed guidance for its second
fiscal quarter ending December 30,
2012 that was previously issued and detailed in a press
release on October 25, 2012.
Conference Call and Webcast Information
Emulex and
Endace will host a conference call and webcast today at
2:00 p.m. PST (11:00 a.m. NZDT on December 6) to discuss the acquisition in
detail. Emulex CEO Jim
McCluney, Endace CEO Mike
Riley, Emulex President and COO Jeff
Benck, and Emulex Executive Vice President and CFO
Mike Rockenbach will host the
call.
The conference call will also be available through live and
archived webcast at www.emulex.com and www.endace.com.
About Emulex
Emulex, the leader in converged
networking solutions, provides enterprise-class connectivity for
servers, networks and storage devices within the data center. The
Company's product portfolio of Fibre Channel Host Bus Adapters,
10Gb Ethernet Network Interface Cards, Ethernet-based Converged
Network Adapters, controllers, embedded bridges and switches, and
connectivity management software are proven, tested and trusted by
the world's largest and most demanding IT environments. Emulex
solutions are used and offered by the industry's leading server and
storage OEMs including, Cisco, Dell, EMC, Fujitsu, Hitachi, Hitachi
Data Systems, HP, Huawei, IBM, NEC, NetApp and Oracle. Emulex is
headquartered in Costa Mesa,
Calif. and has offices and research facilities in
North America, Asia and Europe. More information about Emulex (NYSE:
ELX) is available at www.Emulex.com.
About Endace
Endace provides world-leading network
visibility infrastructure, which is trusted by some of the world's
largest organizations to accelerate their response to network and
security problems.
Endace Intelligent Network Recorders guarantee to capture, index
and record 100-percent of network traffic while scaling from 1 Gbps
to 100 Gbps. EndaceVision is Endace's proprietary web-based
application that enables engineers to visualize, search and
retrieve network traffic from any Endace Recorder anywhere across
the network.
Endace's marketing headquarters are in Sunnyvale, California. R&D is in
Auckland, New Zealand. Sales
offices across the US, in Reading,
UK and Sydney, Australia
provide support for customers.
Quoted on London's AIM, the
stock code is LSE: EDA.L
"Safe Harbor" Statement
"Safe Harbor'' Statement under
the Private Securities Litigation Reform Act of 1995: With the
exception of historical information, the statements set forth
above, including, without limitation, those contained in the
discussion of "Business Outlook" above, and the reconciliation of
forward-looking diluted earnings per share below, contain
forward-looking statements that involve risk and uncertainties. We
expressly disclaim any obligation or undertaking to release
publicly any updates or changes to these forward-looking statements
that may be made to reflect any future events or circumstances. We
wish to caution readers that a number of important factors could
cause actual results to differ materially from those in the
forward-looking statements. These factors include the possibility
that the proposed acquisition of Endace Limited (Endace) is not
completed on a timely basis or at all, the effects of the
proposed acquisition of Endace, including our ability to
realize the anticipated benefits of the potential acquisition of
Endace on a timely basis or at all, and our ability to integrate
the technology, operations and personnel of Endace into our
existing operations in a timely and efficient manner. In
addition, intellectual property claims, with or without merit, that
could result in costly litigation, cause product shipment delays,
require us to indemnify customers, or require us to enter into
royalty or licensing agreements, which may or may not be available.
Furthermore, we have in the past obtained, and may be required in
the future to obtain, licenses of technology owned by other
parties. We cannot be certain that the necessary licenses will be
available or that they can be obtained on commercially reasonable
terms. If we were to fail to obtain such royalty or licensing
agreements in a timely manner and on reasonable terms, our
business, results of operations and financial condition could be
materially adversely affected. Ongoing lawsuits, such as the action
brought by Broadcom Corporation (Broadcom), present inherent risks,
any of which could have a material adverse effect on our business,
financial condition, or results of operations. Such potential risks
include continuing expenses of litigation, risk of loss of patent
rights and/or monetary damages, risk of injunction against the sale
of products incorporating the technology in question,
counterclaims, attorneys' fees, incremental costs associated with
product or component redesigns, and diversion of management's
attention from other business matters. With respect to the
continuing Broadcom litigation, such potential risks also include
the adequacy of any sunset period to make design changes, the
ability to implement any design changes, the availability of
customer resources to complete any re-qualification or re-testing
that may be needed, the ability to maintain favorable working
relationships with Emulex suppliers of serializer/deserializer
(SerDes) modules, and the ability to obtain a settlement which does
not put us at a competitive disadvantage. In addition, the fact
that the economy generally, and the technology and storage market
segments specifically, have been in a state of uncertainty makes it
difficult to determine if past experience is a good guide to the
future and makes it impossible to determine if markets will grow or
shrink in the short term. The current weakness in domestic and
worldwide macro-economic conditions and related disruptions in
world credit and equity markets that are creating economic
uncertainty for our customers, as well as the storage and converged
networking market as a whole, has and could continue to adversely
affect our revenues and results of operations. As a result of these
uncertainties, we are unable to predict our future results with any
accuracy. Other factors affecting these forward-looking statements
include but are not limited to the following: faster than
anticipated declines in the storage networking market, slower than
expected growth of the converged networking market or the failure
of our Original Equipment Manufacturer (OEM) customers to
successfully incorporate our products into their systems; our
dependence on a limited number of customers and the effects of the
loss of, decrease in or delays of orders by any such customers, or
the failure of such customers to make timely payments; the
emergence of new or stronger competitors as a result of
consolidation movements in the market; the timing and market
acceptance of our products or our OEM customers' new or enhanced
products; costs associated with entry into new areas of the server
and storage technology markets; the variability in the level of our
backlog and the variable and seasonal procurement patterns of our
customers; any inadequacy of our intellectual property protection
and the costs of actual or potential third-party claims of
infringement and any related indemnity obligations or adverse
judgments; the effect of any actual or potential unsolicited offers
to acquire us; impairment charges, including but not limited to
goodwill and intangible assets; changes in tax rates or
legislation; the effects of acquisitions; the effects of terrorist
activities; natural disasters, such as the earthquake and resulting
tsunami off the coast of Japan in
March 2011 and the significant
flooding in various parts of Thailand in October
2011, and any resulting disruption in our supply chain or
customer purchasing patterns or any other resulting economic or
political instability; the highly competitive nature of the markets
for our products as well as pricing pressures that may result from
such competitive conditions; the effects of changes in our business
model to separately charge for software; the effect of rapid
migration of customers towards newer, lower cost product platforms;
possible transitions from board or box level to application
specific integrated circuit (ASIC) solutions for selected
applications; a shift in unit product mix from higher-end to
lower-end or mezzanine card products; a faster than anticipated
decrease in the average unit selling prices or an increase in the
manufactured cost of our products; delays in product development;
our reliance on third-party suppliers and subcontractors for
components and assembly; our ability to attract and retain key
technical personnel; our ability to benefit from our research and
development activities; our dependence on international sales and
internationally produced products; changes in accounting standards;
and any resulting regulatory changes on our business. These and
other factors could cause actual results to differ materially from
those in the forward-looking statements and are discussed in our
filings with the Securities and Exchange Commission, including our
recent filings on Forms 10-K and 10-Q, under the caption "Risk
Factors."
This news release refers to various products and companies by
their trade names. In most, if not all, cases these
designations are claimed as trademarks or registered trademarks by
their respective companies.
Emulex
Investor Contact:
|
Endace
Press/Investor Contact:
|
Frank
Yoshino
|
Tim
Nichols
|
Vice
President, Finance
|
Vice
President, Corporate Marketing
|
+1 714
885-3697
|
+1 408
220-6149
|
frank.yoshino@emulex.com
|
tim.nichols@endace.com
|
|
|
Emulex
Press Contact:
|
|
Katherine
Lane
|
|
Director,
Corporate Communications
|
|
+1 714
885-3828
|
|
katherine.lane@emulex.com
|
|
SOURCE Emulex Corporation