EFI has been acquired by an affiliate of private equity firm Siris Capital Group in an all-cash transaction valued at approximately $1.7 billion.
Under the terms of the deal, the Siris affiliate will buy all of EFI’s outstanding common stock by paying $37.00 per share in cash, roughly a 45% premium over EFI’s 90-day volume-weighted average price at the end of play on April 12th 2019. The market was obviously impressed as EFI’s share price rose on the news, hitting a highpoint of $38.31 per share.
Siris mainly concentrates on making control investments in data, telecommunications, technology and technology-enabled companies, mostly located in North America.Frank Baker, who co-founded Siris and is a Managing Partner to the company, explained the reason behind this offer, saying: “EFI is at the forefront of the digital transition in the imaging and print industry, underpinned by a strong software heritage and culture of innovation. We believe that, by partnering with Siris, EFI will be well positioned to capture this transformational opportunity associated with increased digital inkjet penetration, industrial automation and software enablement. We are eager to partner with management to help the Company achieve its strategic objectives.”
EFI’s board has unanimously accepted this offer but may still seek alternative proposals from other companies over the next 45 calendar days, a so-called “go-shop” period. If someone else makes a better offer, then EFI still has the right to terminate the agreement with Siris, though Siris also has the right to attempt to match any better offers. EFI has said it will hold of special meeting for its shareholders as soon as possible.
Bill Muir, who only took over from Guy Gecht to become Chief Executive Officer of EFI back in October last year, commented: “We believe this transaction delivers superior and immediate value to our shareholders while providing us with a partner that can add strategic and operational expertise to our business.”
EFI has been through a considerable transformation in the last few years, investing heavily to become a major developer of niche inkjet presses, including its Nozomi digital corrugated press, as well as industrial textile machines through its Reggianni subsidiary, plus the Vutek wide format and creataprint ceramic printers. The company is also a major player in the MIS market, having acquired quite a few other MIS developers over the years, and continues to supply its Fiery front end RIP servers to other press developers, ranging from Xerox to Landa. Last year the company achieved revenues of $1 billion, though it experienced a difficult final quarter, attributed to customers delaying investment in response to weakening economic conditions. The preliminary results for the first quarter of this year are $220-$225 Million, which would indicate a significant drop from the $256.9 million of the previous quarter, or the $239.9 million for Q1 2018.
The deal is expected to close by the third quarter of this year, subject to approval by EFI’s shareholders as well as the usual regulatory conditions, all assuming that there’s no other offer in the “go-shop” period.