17/07/2008 - 12:50

Gemcom shareholders accept $194m offer

17/07/2008 - 12:50

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Shareholders in Gemcom Software International Inc have voted to accept a takeover offer from three equity firms worth $194 million.

Shareholders in Gemcom Software International Inc have voted to accept a takeover offer from three equity firms worth $194 million.

Shareholders will receive the increased takeover price of $C3.05, up from $C2.90 following the successful due diligence of the offer by Pala Investments Holdings Ltd.

Pala will team up with private equity firms JMI Equity and The Carlyle Group for the acquisition.

On completion of the takeover, which is still subject to regulatory approvals, it is understood that Pala will hold a 25 per cent interest in Gemcom while Carlyle and JMI will each hold a 37.5 per cent stake.

WA Business News earlier reported that Perth-based Gemcom directors Tim Moore and Tony Packer will pocket a combined $14.6 million from the sale of their 7.5 per cent interest in the company.

Gemcom services clients in over 90 countries from 19 locations with its largest division operating in Australia, which is headquartered in Perth.

Below is the full announcement:

Vancouver, Canada - July 16, 2008 - Gemcom Software International Inc. (TSX:GCM), the largest global supplier of specialised mining productivity solutions, today announced that its securityholders have approved the plan of arrangement (the "Arrangement") whereby an acquisition vehicle indirectly owned by affiliates of JMI Equity Fund VI, L.P., Carlyle Venture Partners III, L.P. and Pala Investments Holdings Limited (the "Purchaser") will acquire all of Gemcom's outstanding common shares.

The Arrangement involves the acquisition by the Purchaser of all outstanding common shares of Gemcom for which shareholders will receive C$3.05 per share, representing a 22% premium over Gemcom's weighted average closing price for the 45 trading days preceding the original announcement of the proposed transaction. Holders of options and warrants to purchase common shares of Gemcom, in each case that remain outstanding immediately prior to the Effective Time of the Arrangement, will receive for each option and warrant the amount in cash, if any, by which C$3.05 exceeds the exercise price for such option or warrant. Gemcom believes all of the warrants that the Company previously had outstanding will be exercised prior to the Effective Time of the Arrangement.

The Arrangement was approved at the Special Meeting of securityholders by approximately 95% of the votes cast by holders of common shares, exceeding the 66 2/3% required for approval; by approximately 95% of the votes cast by holders of common shares, options and warrants, again exceeding the 66 2/3% required for approval; and by approximately 93% of the votes cast by the minority shareholders, exceeding the 50% threshold required for approval.

Of the total outstanding common shares, options and warrants as at the record date of May 30, 2008, approximately 76% were voted at the meeting either in person or by proxy. Final results will be made available on SEDAR at www.sedar.com.

The closing of the transaction is subject to customary conditions, including the receipt of regulatory approvals, as well as the final order of the Supreme Court of British Columbia. The transaction is expected to close prior to Friday, July 25, 2008. Gemcom will advise shareholders closer to the time of closing about the procedures for surrendering and receiving payment for their securities.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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