News Release
FOR IMMEDIATE RELEASE
Contact: Damon Wright
Sr. Director, Investor Relations
Epicor Software Corporation
949/585-4509
dswright@epicor.com
Epicor to Acquire NSB Retail Systems Creating Specialty Retail
Market Leader
Acquisition Expected to be Materially Accretive to Epicor Non-GAAP EPS in First 12
Months Post-Close1
Epicor Hosting Conference Call Monday, December 17, 2007 at 5:30 a.m. PT/8:30 a.m. ET
IRVINE, Calif. and MONTREAL — December 17, 2007 — Epicor Software Corporation
(Nasdaq: EPIC), a leading provider of enterprise business software solutions for the midmarket
and divisions of Global 1000 companies, and NSB Retail Systems PLC (London Stock
Exchange: NSB), a leading global provider of software solutions and services for the specialty
retail market, jointly announced today that the companies’ respective Boards of Directors have
reached agreement on the terms of the recommended acquisition of NSB by Epicor pursuant to
a scheme of arrangement under section 425 of the United Kingdom Companies Act 1985
whereby shareholders of NSB will receive 38 pence in cash per NSB ordinary share (the
“Scheme”). The terms of the transaction value the fully diluted share capital of NSB at
approximately £160 million (approximately $322 million USD, based on the US$:£ exchange
rate on December 14, 2007). As of June 30, 2007, NSB had cash and equivalents balance of
$34.6 million and no debt.
NSB’s Board of Directors unanimously recommends that NSB Shareholders vote in
favor of the Scheme at the Court Meeting and in favor of the special resolution to approve the
Scheme and related matters to be proposed at the NSB General Meeting, which are expected
to be held on or around January 16, 2008.
Epicor has received undertakings to vote in favor of the Scheme at the Court Meeting to
approve the Scheme from certain NSB Shareholders (including all NSB Directors who hold NSB
Shares) representing approximately 31.2 percent of the existing issued ordinary share capital of
NSB entitled to vote at the Court Meeting and approximately 36.9 percent of the existing issued
Epicor to Acquire NSB Retail Systems
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share capital of NSB entitled to vote at the NSB General Meeting. Further details of these
undertakings, including the circumstances in which certain of these undertakings lapse or can
be withdrawn, are set out in the Announcement: “Recommended Proposals for the Cash
Acquisition of NSB by Epicor” made today in the United Kingdom.
Epicor expects the acquisition to be materially accretive to Epicor’s non-GAAP earnings
for the 12 month period following the close of the transaction.1 Based on expectations for
additional amortization of intangible assets due to the acquisition, Epicor expects the acquisition
to be dilutive to GAAP earnings for a period of time following the close of the transaction. David
Henning, NSB’s current CEO, is expected to remain with the combined company in an
executive management role heading Epicor’s expanded retail business.
“We believe that NSB is an excellent next step in our stated commitment to grow Epicor
both organically and through highly strategic and accretive acquisitions to create a larger,
stronger and more profitable company,” said Epicor Chairman and CEO George Klaus. “Over
the past five years, we have successfully completed four acquisitions of ever increasing scale
and integrated each one on a timely basis while meeting our financial and technology
commitments and providing value to our customers, employees and shareholders.
“NSB’s current retail market focus is well aligned with Epicor’s, and NSB brings an
attractive, loyal customer base, which complements Epicor’s growing presence in the retail
vertical and creates a market leader in the highly fragmented specialty retail market,” Klaus
said. “We believe this combination will create substantial synergies, excellent cross-selling
opportunities and significant economies of scale across the combined company.
“We look forward to continuing to provide the high level of service, support and
unwavering commitment to utilizing the latest in cutting-edge technology across all product lines
that our combined customer base has come to expect from each company,” Klaus continued.
“At the same time, we will work with our combined customer base to ensure they have a clear
understanding of their product roadmap should they choose to leverage the additional
functionality available to them through this combination. We are excited about this opportunity
and we look forward to bringing NSB and their customers into the Epicor family.”
Commenting on the Proposals, Angus Monro, Non-Executive Chairman of NSB Retail,
said, “I am very pleased that we have been able to reach agreement on the terms of this
transaction, which I believe is the right strategic outcome for NSB, offering certainty and value to
our shareholders and great opportunities for our management and employees as part of the
1This statement should not be interpreted to mean that non-GAAP earnings per share will necessarily
match or be greater than those for the relevant preceding financial period.
Epicor to Acquire NSB Retail Systems
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enlarged Epicor. NSB’s product set and customer base should further strengthen Epicor’s
existing position in retail software, and enable this to be leveraged internationally across
Epicor’s broader geographic footprint. I am confident that NSB will make a significant
contribution to the future of the combined business.”
The Scheme and related proposals will be put to NSB Shareholders at the Court
Meeting and at the NSB General Meeting, which are both expected to be held on or around
January 16, 2008. In order to become effective, the Scheme must be approved by a majority in
number of the NSB Shareholders present and voting (and entitled to vote) at the Court Meeting,
either in person or by proxy, and representing not less than 75 percent in value of all Ordinary
Shares that are cast/voted at the Court Meeting (or at any adjournment thereof). In addition, the
Special Resolution implementing the Scheme and related matters must be passed by NSB
Shareholders representing not less than 75 percent of the votes cast at the NSB General
Meeting (or at any adjournment thereof).
The Scheme Document will be posted to NSB shareholders and for information only to
participants in the NSB Share Incentive Schemes and holders of Exchangeable Shares in NSB
as soon as practicable and in any event within 28 days of this announcement. It is expected
that the Scheme will become effective during February 2008, subject to satisfaction of all
conditions, including certain antitrust approvals and the other conditions set out in Appendix I of
the Scheme Document.
Epicor also said that it has replaced its credit facility with a new senior secured credit
facility arranged by Banc of America Securities LLC as Sole Lead Arranger and Book Manager
and with Bank of America, N.A. as Administrative Agent, and KeyBank National Association as
Syndication Agent. The new credit facility provides Epicor with a secured revolving loan facility
in an amount up to $100 million and a secured term loan facility in an amount up to $100 million.
Epicor currently plans to fund the consideration payable under the Scheme with approximately
$155 million in existing cash balances, with the balance of the consideration funded by drawing
from its credit facility.
UBS Investment Bank is acting as financial advisor to Epicor. Close Brothers Corporate
Finance is acting as financial advisor to NSB.
Conference Call and Slide Presentation Information
The Companies will hold an investor and analyst conference call at 5:30 a.m. PT / 8:30
a.m. ET on Monday, December 17, 2007. A slide presentation regarding the proposed
acquisition may be accessed at Epicor’s investor relations Web site at
www.epicor.com/company/investor.
Epicor to Acquire NSB Retail Systems
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When: Monday, December 17, 2007
Time: 5:30 a.m. PT / 8:30 a.m. ET
Dial in: +1 (888) 254-2821; outside the U.S. +1 (913) 312-1408
Conf ID: Epicor Acquisition of NSB Call
Live Webcast: www.epicor.com/company/investor
Slide Presentation: www.epicor.com/company/investor
On the call, George Klaus, Epicor chairman and CEO, Mark Duffell, Epicor president and
COO, Michael Piraino, Epicor executive vice president and CFO and David Henning, NSB CEO,
will discuss the NSB acquisition. John Hiraoka, Epicor senior vice president and CMO will also
be available to participate in the Q&A session. Investors and analysts are invited to participate
on the call. Please dial in approximately ten minutes prior to start time. A live audio-only
webcast of the call will be made available to the public on the Company's Web site at
www.epicor.com/company/investor and will be archived for a period of time following the call on
the Company’s Web site.
About NSB Group
The NSB Group provides a complete range of proven software and hardware solutions to
apparel, specialty, and department store retailers. For more than three decades, NSB solutions
have been improving the ways retailers conduct business and how their customers benefit from
the shopping experience.
About Epicor Software Corporation
Epicor, named one of FORTUNE magazine’s 100 Fastest-Growing Companies in 2006, is a
global leader dedicated to providing integrated enterprise resource planning (ERP), customer
relationship management (CRM), supply chain management (SCM) and professional services
automation (PSA) software solutions to the midmarket and divisions of Global 1000 companies.
Founded in 1984, Epicor serves over 20,000 customers in more than 140 countries, providing
solutions in over 30 languages. Employing innovative service-oriented architecture (SOA) and
Web services technology, Epicor delivers end-to-end, industry-specific solutions for
manufacturing, distribution, retail, hospitality and services that enable companies to drive
increased efficiency, improve performance and build competitive advantage. Epicor solutions
provide the scalability and flexibility to meet today's business challenges, while empowering
enterprises for even greater success tomorrow. Epicor offers a comprehensive range of
services with its solutions, providing a single point of accountability to promote rapid return on
investment and low total cost of ownership. Epicor’s worldwide headquarters are located in
Irvine, California with offices and affiliates around the world. For more information, visit
www.epicor.com.
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Epicor is a registered trademark of Epicor Software Corporation. Other trademarks referenced are the
property of their respective owners. The product and service offerings depicted in this document are
produced by Epicor Software Corporation.
Epicor to Acquire NSB Retail Systems
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Forward-Looking Statements
Management of Epicor Software believes certain statements in this press release may constitute forwardlooking
statements under the Private Securities Litigation Reform Act of 1995. These forward-looking
statements include statements regarding the scheme transaction, potential synergies, the accretive affect
of the transaction, timing of closing, future operations of the combined entity and other statements that
are not historical fact. These forward-looking statements are based on currently available competitive,
financial and economic data together with management’s views and assumptions regarding future events
and business performance as of the time the statements are made and are subject to risks and
uncertainties, including, without limitation, risks associated with market and economic conditions, Epicor’s
ability to consummate the transaction, which is subject to certain conditions, Epicor’s ability to integrate
this acquisition and recognize expected synergies, Epicor’s ability to continue to support NSB’s
customers and add functionality to NSB’s products, and the risks and uncertainties described in Epicor’s
Annual Report on Form 10-K for the year ended December 31, 2006 and Quarterly Report on Form 10-Q
for the three month period ended September 30, 2007. Actual results may differ materially from those
expressed or implied in the forward-looking statements.
As a result of these factors the business or prospects expected by the Company as part of this
announcement may not occur. Epicor undertakes no obligation to revise or update publicly any forwardlooking
statements. |
