| Thu 16 May 2002, 0:00 | | Idion - Press Release |
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Idion - Press Release
IDION rejects final hostile bid from Datamirror
Johannesburg 16 May 2002
Software developer IDION Technology Holdings has once again rejected the
hostile offer from Canadian rival DataMirror, saying the final bid of 180
cents a share still significantly undervalues the company.
IDION advised shareholders to keep their shares and benefit in future from
the company`s inherent value. IDION referred in particular to investments in
and technology developments at its United States subsidiary, Vision
Solutions.
The rejection came after the independent board committee and independent
advisers PricewaterhouseCoopers Corporate Finance examined the merits of
DataMirror`s final offer, made on 7 May.
"Based upon the independent advice received, the Board recommends that you
reject the final consideration and keep your shares in IDION to enable you
to benefit from the inherent value of IDION into the future," the company
advised shareholders.
The advice from PricewaterhouseCoopers Corporate Finance was that they
believed after their review that "the final offer is still significantly
less than the true value of IDION and accordingly is not fair and reasonable
to the interests of the shareholders of IDION".
In addition to research at IDION headquarters in Johannesburg, the
PricewaterhouseCoopers Corporate Finance advisers visited Vision Solutions
in Irvine, California where they had discussions with local management,
technology and distribution partners and some Vision Solutions customers.
IDION CEO Nicolaas Vlok said he still believes the offer is likely to fail.
"We have commitments to reject the offer from more than 54% of shareholders.
This makes it highly unlikely that DataMirror can gain the 50% plus one
share majority it is seeking.
"These commitments are from a management shareholder block, representing
approximately 44%, and other shareholders, including institutional
shareholders, representing a further 10% of the shareholding.
"They have all undertaken not to sell their shares unless and until the
independent committee determines that an offer is fair and reasonable. Since
the independent committee advised the Board to reject DataMirror`s final
offer, the commitment to keep the shares sell remains valid."
Vlok said he would wait with interest to see what DataMirror did with their
minority holding.
"We see great value in IDION and if DataMirror prefers to remain invested in
our shares rather than in developing their own business, that says something
about IDION. If they want to sell, we remain willing to help them find
buyers for their IDION shares."
Financial director Willem Richard criticised in particular the emphasis
DataMirror had placed on the qualifications attached by auditors Deloitte &
Touche to its endorsement of IDION`s profit forecast for 2002.
"This is a standard, formal endorsement of a profit forecast, using wording
stipulated by the rules of the SA Institute of Chartered Accountants. These
comments were not aimed at IDION, as DataMirror should have been well
aware."
IDION said some institutional shareholders had, as expected, sold to
DataMirror at the final offer price.
"Unfortunately, these shareholders will not share in the potential growth of
IDION. The majority of shareholders are opting to hold on to their IDION
shares and therefore reflect a strong view that the value of IDION exceeds
the final offer of 180 cents per IDION share."
Reminding shareholders of its inherent value, IDION referred them to its
investments, particularly new software developments, which were now starting
to pay off.
New products in both Vision Solutions` main operating areas, high
availability and data integration, position the company to open up
additional markets. They enable IDION to offer high availability and data
integration services to corporations operating on Unix, Linux and Microsoft
platforms as well as the IBM iSeries servers where Vision Solutions has
built its reputation.
Vlok said these new developments also helped to cement IDION`s relationship
with IBM, which classifies Vision Solutions as an "IBM Premier Business
Partner" and an "IBM Premier High Availability Business Partner". The sales
of IDION`s software were a driver of IBM iSeries hardware, and IBM in turn
was a partner in distributing and implement IDION software in more than 20
countries, he said.
At international conferences, senior IBM executives have praised Vision
Solutions` high availability software and referred to IBM`s desire to extend
"our combined success in the market place" in 2002 and beyond.
For further information please contact:
Corne Arnold, corporate communication director, IDION
Tel 011 517 1512 or 083 650 6877
