Straight Path Communications Inc. (“Straight Path”) (NYSE MKT:STRP) announced that it will sign today a definitive merger agreement under which Verizon Communications Inc. (“Verizon”) (NASDAQ: VZ) will acquire Straight Path for $184.00 per share (reflecting an enterprise value of approximately $3.1 billion) in an all-stock transaction that is intended to qualify as a tax-free reorganization. Concurrently therewith, Verizon will pay on behalf of Straight Path a termination fee of $38 million to AT&T. The transaction has been approved by the boards of directors of both Straight Path and Verizon.
Straight Path also announced that it will terminate the previously announced definitive agreement and plan of merger with AT&T Inc. (“AT&T”) (NYSE: T) and Switchback Merger Sub Inc., dated as of April 9, 2017 (the “AT&T Merger Agreement”). As previously announced, the Straight Path board of directors determined, in good faith, after consultation with its financial advisors and outside legal advisors, that the transaction with Verizon constituted a Superior Proposal under the AT&T Merger Agreement. AT&T informed Straight Path that after much deliberation, it has determined not to make any new bids or proposals to Straight Path or to propose any amendments to the AT&T Merger Agreement.
The acquisition of Straight Path for $184.00 per share in Verizon stock, implies a premium of 486% to the closing price of Straight Path common stock of $31.41 on January 11, 2017, the day before Straight Path announced its FCC settlement and strategic alternatives process, and 404% premium to the closing stock price of $36.48 on April 7, 2017, the business day prior to entry into the AT&T Merger Agreement. Stock consideration received by Straight Path stockholders will be based on a variable number of Verizon common stock issued at transaction close to ensure fixed consideration of $184.00 per share. The companies anticipate a closing within nine months, subject to FCC review. The transaction is supported by Straight Path’s majority shareholder, Howard Jonas, who has entered into a voting agreement with Verizon and agreed to vote his Class A shares (held through a trust) in support of the transaction, subject to certain limitations.
Evercore served as exclusive financial advisor to Straight Path and Weil, Gotshal & Manges LLP served as company counsel on this transaction. Debevoise & Plimpton LLP served as counsel to Verizon on this transaction.
About Straight Path Communications Inc.
Straight Path (NYSE MKT: STRP) holds an extensive portfolio of 39 GHz and 28 GHz wireless spectrum licenses. Straight Path is developing next generation wireless technology through its Straight Path Ventures subsidiary. Straight Path holds licenses and conducts other business related to certain patents through its Straight Path IP Group subsidiary. Additional information is available on Straight Path’s websites.
IMPORTANT ADDITIONAL INFORMATION WILL BE FILED WITH THE SEC
Straight Path plans to file with the SEC and mail to its stockholders a Proxy Statement/Prospectus in connection with the proposed transaction. THE PROXY STATEMENT/PROSPECTUS WILL CONTAIN IMPORTANT INFORMATION ABOUT VERIZON, STRAIGHT PATH, THE PROPOSED TRANSACTION AND RELATED MATTERS.INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS CAREFULLY WHEN THEY BECOME AVAILABLE.Investors and security holders will be able to obtain free copies of the Proxy Statement/Prospectus and the other documents filed with the SEC by Straight Path through the web site maintained by the SEC at www.sec.gov.In addition, investors and security holders will be able to obtain free copies of the Proxy Statement/Prospectus by phone, e-mail or written request by contacting the investor relations department of Straight Path at the following:
|Straight Path Communications Inc.|
|Address:||5300 Hickory Park Dr., Suite 218|
|Glen Allen, VA 23059|
|Attention: Investor Relations|
PARTICIPANTS IN THE SOLICITATION
Straight Path and its directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transactions contemplated by the Verizon merger agreement.Information regarding Straight Path’s directors and executive officers is contained in Straight Path’s Form 10-K for the year ended July 31, 2016 and its proxy statement dated November 22, 2016, which are filed with the SEC.A more complete description will be available in the Proxy Statement/Prospectus.
In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words “believe,” “anticipate,” “expect,” “plan,” “intend,” “estimate, “target” and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described in our Annual Report on Form 10-K for the fiscal year ended July 31, 2016 and our other periodic filings with the SEC (under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”). We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.
No Offer or Solicitation
This document does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.