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GSI Commerce to acquire Innotrac Corporation
06 Oct '08
5 min read
“Innotrac provides outstanding e-commerce fulfillment and customer care services to some of the best retail and consumer brands in the world,” said Scott Dorfman, CEO of Innotrac. “Our extensive network of facilities and systems is fully integrated and is well suited to complement GSI's existing fulfillment and customer care facilities. We are excited about the opportunities this transaction provides for our employees and clients and look forward to them benefitting from GSI's leadership position in ecommerce and multichannel services.”
Under the definitive agreement, which has been approved by the boards of directors of both companies, GSI will acquire Innotrac for $52 million, consisting of cash of $22 million and shares of GSI common stock valued at $30 million, or 1,841,621 shares at $16.29 per share, the volume weighted average price over the 20 days prior to signing. As of June 30, 2008 Innotrac had net debt of $9.9 million, making the aggregate value of the transaction $61.9 million.
Innotrac shareholders are expected to receive approximately $4.03 per share for each share of Innotrac common stock, consisting of $1.70 in cash and 0.1426 of a share of GSI common stock. The number of shares to be received are subject to adjustment under certain circumstances.
If the volume weighted average price of GSI common stock during the 20 trading days ending on the third trading day prior to the date of the Innotrac shareholders meeting to approve the merger is between $13.03 and $20.85, the number of shares of GSI common stock to be received per share of Innotrac common stock will range from 0.1784 of a share to 0.1115 of a share, and the total number of shares to be issued by GSI will range from 2,302,379 to 1,438,849.
Above $20.85 and below $13.03, the number of shares will be fixed, subject to the right of either party to terminate the definitive agreement under certain circumstances if the price is below $11.12.
The acquisition is expected to close during the first half of 2009 and is subject to customary and other closing conditions, including the approval of Innotrac stockholders, certain third-party consents, and court approval by the United States District Court for the Northern District of Ohio of a settlement agreement between Innotrac and the court-appointed receiver of the IPOF Fund, L.P., which holds approximately 35 percent of the outstanding shares of Innotrac. Innotrac's chairman and CEO, who owns approximately 46 percent of the company's issued and outstanding shares, has agreed to vote in favor of the transaction.
Under the definitive agreement, which has been approved by the boards of directors of both companies, GSI will acquire Innotrac for $52 million, consisting of cash of $22 million and shares of GSI common stock valued at $30 million, or 1,841,621 shares at $16.29 per share, the volume weighted average price over the 20 days prior to signing. As of June 30, 2008 Innotrac had net debt of $9.9 million, making the aggregate value of the transaction $61.9 million.
Innotrac shareholders are expected to receive approximately $4.03 per share for each share of Innotrac common stock, consisting of $1.70 in cash and 0.1426 of a share of GSI common stock. The number of shares to be received are subject to adjustment under certain circumstances.
If the volume weighted average price of GSI common stock during the 20 trading days ending on the third trading day prior to the date of the Innotrac shareholders meeting to approve the merger is between $13.03 and $20.85, the number of shares of GSI common stock to be received per share of Innotrac common stock will range from 0.1784 of a share to 0.1115 of a share, and the total number of shares to be issued by GSI will range from 2,302,379 to 1,438,849.
Above $20.85 and below $13.03, the number of shares will be fixed, subject to the right of either party to terminate the definitive agreement under certain circumstances if the price is below $11.12.
The acquisition is expected to close during the first half of 2009 and is subject to customary and other closing conditions, including the approval of Innotrac stockholders, certain third-party consents, and court approval by the United States District Court for the Northern District of Ohio of a settlement agreement between Innotrac and the court-appointed receiver of the IPOF Fund, L.P., which holds approximately 35 percent of the outstanding shares of Innotrac. Innotrac's chairman and CEO, who owns approximately 46 percent of the company's issued and outstanding shares, has agreed to vote in favor of the transaction.
GSI Commerce Inc
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