EXFO majority owner says it’s “not for sale”
SCOTTSDALE, Ariz., and QUEBEC CITY — American network test and monitoring solution provider Viavi Solutions Inc. early today made a hostile bid to take over ownership of Quebec competitor EXFO Inc., also a leading telecom testing and monitoring specialist.
This follows news last week EXFO, currently a publicly traded company, has agreed to have its founder and majority shareholder, Germain Lamonde, acquire the remaining shares in the corporation he doesn’t already own or control. To take the company private, Lamonde is offering US$6 per share to shareholders of EXFO’s subordinate voting shares. A shareholder vote on Lamonde’s offer is expected to take place during a special meeting sometime before July 30.
In a press release today, Viavi says it will pay US$7.50 (CAN$9.14) per share for all of the outstanding subordinate voting shares and multiple voting shares of EXFO, as per a proposal Viavi has submitted to EXFO’s board of directors. Viavi’s proposal values EXFO at approximately US$430 million (CAN$524 million), and represents a 25% premium to Lamonde’s offer of US$6 per share, the Scottsdale, Ariz.-based company says.
Viavi says in the press release its own board of directors has unanimously approved the proposal and is now waiting to engage with EXFO’s board and Lamonde.
Later this afternoon, Lamonde responded by issuing his own statement, stating: “This is the third time that Viavi has made an offer to acquire EXFO, after its first and second attempts in November 2020 at a price of US$4.75 and in May 2021 at a price of US$5.25, respectively. On both occasions, I have indicated clearly to the board of directors of EXFO that, as the controlling shareholder of EXFO, I would not consider any transaction with Viavi and the board consequently concluded that there was no merit in pursuing any discussions with Viavi and did reiterate today to the board that, for the third time, Viavi’s non-binding proposal would not obtain my support as the controlling shareholder.”
Lamonde added: “As I have previously indicated numerous times to the board of EXFO, as a controlling shareholder, I will not consider any alternative change of control transaction of EXFO, such as the one proposed by Viavi and my shares are not for sale. I have founded EXFO and been involved in the company over the last 35 years and I believe that the business is well-managed, growing, strategically positioned for the evolving and dynamic future of the communications test and measurement industry.”
As for what happens should EXFO’s shareholders decide not to accept Lamonde’s offer of US$6 per share, he said the company would continue on, publicly traded.
“I want to be crystal clear for the benefit of EXFO’s shareholders and other stakeholders: either the proposed transaction that I made at US$6.00 and that was announced on June 7, 2021, is accepted by shareholders or, should EXFO’s shareholders not support this transaction, EXFO will continue its life as a public company. I believe wholeheartedly in the prospects of EXFO as a stand-alone company and I have no intention of changing the current operations of EXFO, including the location of its head office in Québec City.”
For Lamonde’s full statement, please click here.
