SAP's North American subsidiary, SAP America, Inc., today increased its tender offer price for US retail software specialist Retek to $11.00 per share in cash, from $8.50. The Retek board of directors is unanimously recommending to Retek stockholders that they accept the revised SAP offer in preference to last week's $9 per share bid by SAP arch-rival Oracle.
SAP America and Retek have signed an amendment to the merger agreement already announced, modifying the offer price from $8.50 to $11.00. In addition, under the amended merger agreement the termination fee has been increased from $15 million to $25 million. All other elements of the transaction remain unchanged.
Retek's board of directors is unanimously recommending to Retek stockholders that they accept the revised SAP offer, which represents a 29% premium over SAP America's original offer on February 28, 2005, a premium of 22% over the Oracle proposal announced on March 8, 2005 and a premium of approximately 5% over Retek's closing price on March 16, 2005.
"We believe that SAP's offer is a good deal for Retek stockholders, and our board of directors has unanimously recommended that it be accepted," said Marty Leestma, President and Chief Executive Officer of Retek.
Headquartered in Minneapolis, Retek provides an integrated retail application suite and best-of-breed solutions to more than 200 customers in more than 20 countries around the world. With 2004 annual revenue of $174.2 million and approximately 525 employees, Retek also has offices in Atlanta, London and Melbourne.
"SAP is the undisputed leader in business applications in the U.S. and globally. The retail industry is a strategic priority for SAP, and we have many years of experience in developing and delivering retail solutions," said Leo Apotheker, President, Global Field Operations and Member of the Executive Board of SAP AG. "We have more than 2,400 retail customers including such leading brands as The Body Shop, Limited Brands and J. Crew. The combination of SAP and Retek will provide customers worldwide with a deep industry knowledge that they could not get from any other software combination."
Apotheker continued, "With SAP, customers have a choice in selecting their database - customers are not locked into a single database vendor. Moreover, with our open integration platform SAP NetWeaver, we can offer our retail customers a swift and painless path to integration and with the Business Process Platform a clear and defined roadmap to the future of business software."
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