NEW YORK, May 26, 2010 (GLOBE NEWSWIRE) -- Arcadia Capital Advisors, LLC ("Arcadia") and its managing director, Richard S. Rofe ("Rofe"), a shareholder of Symyx Technologies ("Symyx"), reported that Arcadia was not likely to support the "merger of equals," all stock-for-stock transaction between Symyx and Accelrys, Inc. ("Accelrys") announced on April 5 (the "Merger") as it currently stands.
Arcadia believes the recent alternative acquisition proposals for Symyx, announced in SEC filings by Symyx and Accelrys, warrant serious consideration from the Symyx Board of Directors (the "Board") and Symyx shareholders. Richard Rofe stated, "Although we were pleased that the Merger announced last month has provided a spotlight on the intrinsic value in Symyx, we are concerned that the Board has not focused on maximizing shareholder value by brazenly rejecting any and all competing proposals to date."
Arcadia noted that recent disclosures filed in the Accelrys-Symyx joint proxy and in subsequent 8-k filings show Symyx has received multiple all-cash bid proposals from two interested parties. These all-cash offers were at prices of $6.00 per share, $6.25 per share, and most recently $6.50 per common share. Symyx's Board rejected the latest offer on May 20, 2010, as the Board stated that the alternative proposal was "inadequate, from a financial point of view, considering the price offered in comparison to the terms of the proposed Merger with Accelrys and long-term value which the Merger could provide to Symyx stockholders, and Symyx valuation as a stand-alone company." Arcadia's analysis of the Symyx-Accelrys Merger has found the following:
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Under the terms of the Merger, Symyx shareholders are slated to receive 0.7802 shares of Accelrys common stock for each Symyx share. As of Tuesday, May 25, 2010, Accelrys common stock closed at $6.73 per share, which implies each share of Symyx, or the "merger-equivalent value," to be worth approximately $5.25 per share at the same contemplated exchange ratio.
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This "merger-equivalent price" of $5.25 per share represents an 11% discount to the market closing price for SMMX on Tuesday, May 25 of $5.91 per share.
- Further, the most recent all-cash offer of $6.50 per share rejected by the Symyx board as "inadequate" actually represents a substantial premium to the "merger-equivalent price" and current Symyx share price. This competitive offer represents a 24% premium to the "merger-equivalent" value of $5.25 per share and a 10% premium to the Symyx stock price of $5.91 at Tuesday's market close.
Based on an analysis of the recent all-cash offer versus the proposed stock-for-stock transaction, Arcadia disagrees with the Board's rationale for rejecting the most recent proposal. Arcadia believes that there are inherent benefits to an all-cash transaction for shareholders. Rofe stated, "As a long-term Symyx shareholder, we would be more comfortable with the certainty of cash now rather than be dependent upon the execution risk, integration risk, market risk, and other uncertainties in the current economic environment related to any expected long-term value of the Symyx-Accelrys combination."
Arcadia and Rofe also questions whether the 50 percent ownership stake in the combined company for Symyx shareholders accurately reflects an acceptable value of Symyx in light of these competing offers, Accelrys' own recent disappointing earnings announcement, and Symyx's significant financial contribution to the combined entity.
Arcadia believes that the Board is not fulfilling its fiduciary duty to maximize shareholder value. By rejecting outright a possibly superior offer, the Board is effectively eliminating the opportunity for shareholders to immediately receive additional value. Arcadia requests the Symyx Board to conclude that the latest all cash proposal is greater than the present "merger equivalent value" and as a result may lead to a superior proposal. By taking this action, the Board would then be able to permit one or both parties to commence limited due diligence without triggering a termination event with Accelrys. The Board should also require the competing parties to submit a binding proposal prior to June 30, 2010, the date of the shareholder vote on the proposed Merger with Accelrys. Rofe stated that "the best way to maximize shareholder value at this point is by fully vetting alternative proposals without putting the Accelrys Merger at risk."
About Arcadia Capital Advisors
Arcadia Capital Advisors is a private investment firm based in New York that employs a value-oriented investment philosophy in the management of long/short hedge funds focused on small and micro-cap companies. The firm is led by Richard Rofe and is sponsored by M.D. Sass-Macquarie Financial Strategies.