NEEDHAM, Mass. & WATERLOO, Ontario, Apr 07, 2011 (BUSINESS WIRE) --
PTC (Nasdaq: PMTC), The Product Development Company(R), and MKS
Inc. (TSX: MKX), a global application lifecycle management (ALM)
technology leader, today announced that they have entered into a
definitive acquisition agreement (the "Arrangement Agreement") pursuant
to which PTC has agreed to acquire MKS for CDN$26.20 per share for an
aggregate purchase price of approximately CDN$292.5 million in an all
MKS Integrity(TM) coordinates and manages all activities and
artifacts associated with developing software intensive products,
including requirements, models, code and test, ensuring comprehensive
lifecycle traceability. By unifying MKS's ALM solutions with PTC's
industry-leading product lifecycle management (PLM) solutions, PTC will
enable manufacturers to better align the management of a product's
hardware components and related software.
"At PTC, we recognize that software is an essential component of nearly
every manufactured product," said PTC president and CEO Jim Heppelmann.
"That's why we have long believed that the development of product
hardware and software should be managed as a unified process. With the
acquisition of MKS, we are adding a best-of-breed ALM solution to our
product portfolio, and extending how our PLM solution manages the
development of software-intensive products."
Today, software is considered a critical source of product innovation.
Yet, software development is often managed separately from the hardware
into which it is embedded. This can lead to reduced product quality and
increased total service costs. By unifying the management of the
hardware and software development lifecycles, PTC will foster greater
collaboration between disparate engineering and development teams,
enabling improved requirements management and system engineering.
"As a technology leader, MKS has seen incredible success in the ALM
market and we are proud to have built such a strong and loyal customer
base," said MKS president and CEO Michael Harris. "We view the
opportunity to join PTC, which we believe is the unambiguous PLM market
leader, as a way to accelerate our own innovation, offer our existing
customers even greater value, and extend our reach into new markets."
The acquisition is expected to close in early June 2011, subject to
customary conditions, including approval of the MKS shareholders,
Ontario court approval, and regulatory approvals. The acquisition is
expected to be neutral to PTC's non-GAAP financial results in fiscal
2011 and slightly accretive to PTC's non-GAAP financial results in
About the Transaction
The acquisition will be carried out as a court-approved plan of
arrangement under the Business Corporations Act (Ontario) (the
"Arrangement") with MKS shareholders receiving cash in the amount of
CDN$26.20 per MKS common share. PTC will finance the transaction by
drawing on its existing credit facility in the amount of approximately
$250 million and with cash on hand of approximately $54 million. All
outstanding vested options and RSUs of MKS will be cash settled on the
closing date of the Arrangement and all unvested options of MKS will be
assumed by PTC. The Arrangement must be approved by at least 66 2/3% of
the votes cast by MKS shareholders at a special meeting of MKS
shareholders expected to be held in late May 2011. The transaction is
subject to court approval in Ontario as well as customary closing
conditions, including regulatory approvals.
The transaction has been unanimously approved by the board of directors
of each of PTC and MKS. Mooreland Partners LLP acted as financial
advisor to MKS with respect to the Arrangement and provided a fairness
opinion to the MKS Board. The Arrangement was reviewed by an independent
committee of the MKS Board in consultation with its legal and financial
advisors, which unanimously determined that the Arrangement is fair to
MKS shareholders and in the best interest of MKS. The MKS Board, based
in part on the recommendation of the independent committee, concluded
that the transaction is fair to shareholders of MKS and is in the best
interests of MKS and recommends that shareholders of MKS vote in favor
of the Arrangement at the special meeting of shareholders of MKS.
Directors and managers, including the Executive Chairman, CEO and CFO,
who hold shares representing approximately 25% of the outstanding common
shares of MKS have agreed to vote their shares in favor of the
The Arrangement Agreement contains customary terms and conditions,
including the obligation of MKS to pay PTC a termination fee of
CDN$11.55 million in the event that the agreement is terminated in
Upon completion of the transaction, the MKS shares will be de-listed
from the Toronto Stock Exchange.
Morgan Stanley & Co. acted as financial advisor to PTC.
PTC to Hold Investor Call at 8:30 am ET TODAY,
April 7, 2011
PTC management will host a conference call to discuss this acquisition
TODAY, April 7 at 8:30 am ET.
PTC to acquire MKS Conference Call
Thursday, April 7th, 2011 at 8:30 am (ET)
USA: 1-800-857-5592 and International: 1-773-799-3757
Call Leader: James Heppelmann
The audio replay of this event will be archived for public replay
until 4:00 pm (CT) on April 12, 2011 at USA: 1-888-293-8912
International: 1-203-369-3023. To access the replay via webcast,
please visit www.ptc.com/for/investors.htm.
PTC (Nasdaq: PMTC), The Product Development Company(R),
develops, markets and supports product development software solutions
and related services that help companies achieve their product
development strategies and optimize their processes. Using the company's
tightly integrated CAD and enterprise PLM solutions, organizations are
better able to create and manage product information throughout the
lifecycle for optimal product development success.
MKS enables organizations to reduce the overwhelming complexity of
developing software intensive products thereby removing barriers to
MKS Integrity(TM) manages all systems and software development
processes and connects all engineering artifacts, including
requirements, models, code and tests, ensuring comprehensive lifecycle
traceability. MKS Integrity's(TM) open architecture integrates
disparate tools into a streamlined engineering process, allowing
orchestration of engineering change and collaboration across the
technology supply chain. With MKS Integrity(TM), engineering
teams improve productivity and quality, streamline compliance and gain
complete product visibility, which ultimately drives more innovative
products into the market.
With offices worldwide, MKS supports customers across industries
including, Automotive, Aerospace and Defense, High Tech Electronics and
Medical Devices. For more information about MKS and MKS Integrity(TM),
visit our web site at http://www.mks.com.
Forward Looking Statements and Risks
This news release contains forward-looking statements, including
statements about completion of the Arrangement, future results,
integration of the companies' technologies, and anticipated debt levels.
These statements involve risks and uncertainties that could cause actual
results to differ materially from those projected, including the
following: PTC and MKS may be unable to satisfy the closing conditions,
which include obtaining MKS shareholder approval and regulatory
approvals, and complete the transaction; PTC may be unable to
successfully operate the businesses to achieve the expected financial
results; PTC may be unable to successfully develop and integrate the
technology necessary to offer an integrated solution that complements
PTC's product development system; PTC may be unable to retain and
maintain relationships with key employees, customers and other strategic
partners of MKS; as well as other risks and uncertainties detailed from
time to time in reports filed by PTC with the U.S. Securities and
Exchange Commission, including PTC's most recent reports on Forms 10-K
Additional Information and Where You Can Find It
This material is not a substitute for the management information
circular that MKS intends to file with the Canadian securities
regulatory authorities or any other documents which PTC or MKS may file
or distribute in connection with the proposed transaction. INVESTORS AND
SECURITY HOLDERS ARE URGED TO READ THE MANAGEMENT INFORMATION CIRCULAR
AND ALL OTHER RELEVANT DOCUMENTS IF AND WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
ARRANGEMENT. Investors and securityholders may obtain any documents
pertaining to the proposed Arrangement filed by MKS with SEDAR at www.sedar.com
and filed by PTC at the SEC's website (www.sec.gov).
This announcement is for information purposes only and does not
constitute or form part of any offer or invitation to purchase,
otherwise acquire, subscribe for, sell, otherwise dispose of or issue,
or any solicitation of any offer to sell, otherwise dispose of, issue,
purchase, otherwise acquire or subscribe for, any security.
PTC, the PTC logo and The Product Development Company are trademarks or
registered trademarks of Parametric Technology Corporation and its
subsidiaries in the United States and other countries.
MKS and MKS Integrity are trademarks or registered trademarks of MKS
Inc. in Canada and other countries.
SOURCE: PTC and MKS Inc.
Eric Snow, 781.370.6210
Doug Sawatzky, 519.883.3252