US company Polycom (Nasdaq: PLCM) today announced it had reached an agreement for the acquisition of Accord Networks (Nasdaq: ACCD), which manufactures products for rich media voice, and video communications traffic on IP and other networks.
Polycom, whose market value stood at $3.48 billion yesterday, deals in broadband communications solutions. Under the acquisition agreement, Polycom will allocate 6.26 million of its shares, priced yesterday at $46.12, in exchange for all outstanding Accord shares. 1.51 million Polycom shares will be allocated in exchange for all outstanding Accord options and warrants.
The exchange rate for the transaction is 0.3065 Polycom shares for each Accord share.
The acquisition process is scheduled for completion in the first quarter of 2001. The transaction is intended to be accounted for as a pooling of interests, in order to qualify as a tax-free reorganization.
The high 119% premium on Accord shares for the transaction is due to the fact that the deal is a share swap and from Polycom’s belief in Accord’s capabilities. The closing value of the Accord share on Nasdaq gave the company a market value of $132 million.
Accord is traded at $6.56 per share.
Published by Israel's Business Arena on December 6, 2000