Here is a very quick synopsis of the ongoing Certicom/RIM/VeriSign story: They opened their doors back in 1985 and are and encryption software company with offices in Canada, US, Europe, and Asia. Over the years they have racked up huge clients such as IBM, Motorola, Oracle, Unisys, XM, General Electric, Texas Instruments, Qualcomm, Phillips, Samsung, Sony Ericsson, Nortel and Research In Motion (RIM).
With RIM being a major client they saw great value in taking over Certicom and put an official offer on the table back in December 2008 for $66 million or $1.50 per share (the talks actually started February 2007). Certicom basically said, no thanks and told their shareholder to reject the offer as it “does not provide fair value” for who their technology… and accused RIM of violating confidentiality agreements.
The matter was taken to the Ontario Superior Court of Justice to block RIM from making a bid and contacted the Ontario Securities Commission for a cease trade order on their shares. This takes up to mid January 2009 where a ruling by Justice Alexandra Hoy resulted in officially halting RIM from its hostile takeover bid. Hoy said “The use of the confidential information provided pursuant to the two non-disclosure agreements at issue … to assess the desirability of a hostile takeover bid breached those agreements.”
During this process, Certicom said that they have other parties interested in buying them… along comes a surprise offer from VeriSign for $92 million or $2.10 per share (a 40% increase in value). Certicom board chairman Jeffrey Chisholm said “The special committee and the board conducted a thorough process on behalf of Certicom shareholders resulting in a significant increase in value for the company and its owners. We believe this transaction also represents a very promising opportunity for our customers and employees.”
RIM was most likely fuming and was not going to settle… came back to the table with an astonishing proposal of $3.00 per share, or about $131 million and 43% over the current VeriSign offer… which takes us to today:
“Certicom announced today that its Board of Directors has determined that the offer by Research In Motion Limited, announced on February 3, 2009, to acquire all of the issued and outstanding common shares of the Company by way of a statutory plan of arrangement at a cash price of C$3.00 per share (the “RIM Offer”) is a “Superior Proposal” as defined under the arrangement agreement between VeriSign, Inc. and Certicom.”
Under this new agreement, VeriSign has 5 business days to revise the offer and present it to Certicom by February 11, 2009. If Certicom ends up taking the RIM offer they will have to pay out $4 million (CDN) in termination fees to VeriSign.
More to come soon.