Interactive Data Corporation (NYSE: IDC), a leading provider of financial market data, analytics and related solutions, today announced that it has entered into a definitive agreement to be acquired by investment funds managed by Silver Lake and Warburg Pincus in a transaction with a total value of $3.4 billion.
The agreement was unanimously approved by the Interactive Data Board of Directors, taking into consideration the recommendation of the Special Committee composed solely of the Companyâs four independent directors. This Special Committee was formed as part of the previously disclosed review of strategic alternatives that was conducted by Interactive Dataâs Board of Directors. In addition, Pearson plc, Interactive Dataâs majority stockholder, has formally approved the transaction.
Under the agreement, Interactive Dataâs stockholders will receive $33.86 in cash for each share of Interactive Data common stock they own. This represents a premium of approximately 32.9 percent over the closing share price on Thursday, January 14, 2010, the last trading day before the Company announced that its Board of Directors was conducting a review of strategic alternatives. Completion of the transaction is expected to occur by the end of the third quarter of 2010, following regulatory approvals and other customary closing conditions.
Rona Fairhead, chairman of Interactive Dataâs board of directors, said: âThis transaction enables Interactive Dataâs shareholders to realize substantial value and provides the company with partners who are committed to supporting its global expansion. Interactive Data has an outstanding team of more than 2,400 people and the Board thanks them sincerely for their skill and commitment in serving our customers and building the Company over many years. With the support of Silver Lake and Warburg Pincus, I am confident that Interactive Data will take full advantage of its strong market position and the changes in technology and regulations that are shaping its industry.â
âTodayâs announcement is a very positive outcome for stockholders, customers and employees,â said Ray DâArcy, Interactive Dataâs president and chief executive officer. âPearson has been a valuable, supportive partner to Interactive Data over the years as we expanded our business globally. Transitioning our ownership structure will mark an exciting, new chapter in Interactive Dataâs development. With the backing of Silver Lake and Warburg Pincus, we look forward to accelerating our momentum and further enhancing our capabilities, delivery platforms and technical infrastructure. I believe that the collective experience and expertise of these firms in the financial services and technology sectors will enable us to take our Company to a new level in terms of our size, capabilities and stature in the industry.â
Mike Bingle, Managing Director of Silver Lake, commented, "Interactive Data is an innovative leader in the information services industry, and our investment is a compelling addition to Silver Lake's portfolio of premier technology-enabled companies. Interactive Data and the services it provides are essential to enhancing efficiency and transparency in the flow of global financial data."
Joe Osnoss, Managing Director of Silver Lake, added, âSilver Lake and Warburg Pincus both have significant experience investing in market-leading companies at the intersection of financial services and technology. Interactive Data is particularly well-positioned as a global financial technology growth platform, and we expect a strong partnership between our firms and Interactive Dataâs customers and employees in pursuing this opportunity.â
Jim Neary, Managing Director at Warburg Pincus, commented, âThis acquisition aligns well with our financial technology and information investment theses; Interactive Data is a market leader that provides critical data to its customers. We look forward to partnering with them, and Silver Lake, as the Company continues to grow and expand its footprint.â
Cary Davis, Managing Director at Warburg Pincus, added, âInteractive Data, an independent source of pricing data, is regarded as âthe gold standardâ by its customers. The information provided by Interactive Data has increased in importance following the market crisis, and will continue to do so as the demand for transparency intensifies.â
Following the completion of the transaction, Interactive Data will remain headquartered in Bedford, Massachusetts and maintain its offices around the world. The Company will continue to be led by its senior management team and expects to continue expanding its workforce over time.
As Interactive Dataâs majority stockholder, Pearson has executed a written consent to approve the transaction, thereby providing the required stockholder approval for this transaction. No further action by non-Pearson stockholders is required to approve this transaction. Please refer to the âAdditional Information and Where to Find Itâ section below for further details about relevant information about this transaction that will be made available to all investors and stockholders.
The transaction has fully committed financing, consisting of a combination of equity to be invested by Silver Lake and Warburg Pincus and debt financing to be provided by Bank of America Merrill Lynch, Barclays Bank PLC, Credit Suisse Securities (USA) LLC and UBS Investment Bank. Silver Lake and Warburg Pincus are equal equity partners in this transaction.
Goldman, Sachs & Co. acted as financial advisor to the Company, and Morgan, Lewis & Bockius LLP acted as legal advisor to the Company.
Foros acted as financial advisor to the Special Committee of the Board, and Cleary Gottlieb Steen & Hamilton LLP acted as legal advisor to the Special Committee.
Credit Suisse Securities (USA) LLC acted as lead financial advisor, Barclays Capital Inc., Morgan Stanley and UBS Investment Bank acted as financial advisors and Simpson Thacher & Bartlett LLP acted as legal advisor to Silver Lake and Warburg Pincus.