RAE Systems Inc. (NYSE Amex: RAE), a leader in delivering innovative sensor solutions to serve industrial, energy, environmental, firefighting, and government safety markets worldwide, signed a definitive agreement to be acquired for $1.60 per share in cash by an affiliate of Battery Ventures, a multi-stage investment firm focused on technology and innovation worldwide. The purchase price represents a premium of approximately 53.8% over RAE Systems' closing share price on September 17, 2010, and a premium of approximately 85.1% over RAE Systems' average closing share price for the 30 trading days ending on September 17, 2010.
This transaction is subject to customary closing conditions, including the approval of RAE Systems' stockholders. There is no financing condition to the transaction.
"Over the years, we have built a strong reputation in the safety industry, a quality, diverse product and technology portfolio, and a dedicated, result-oriented employee base, all of which are contemplated in this transaction," said Robert Chen, RAE Systems president and chief executive officer. "After an extensive review of our strategic alternatives, the special committee of our board of directors has determined that this transaction provides for the best value to our stockholders. RAE Systems has successfully navigated through a great deal of change over the past few years. With this newest evolution, RAE Systems will leverage Battery Ventures' strategy and vision to help increase its industry presence via organic growth and complementary acquisitions. Looking ahead, we will continue to execute on our strategy to be a leading innovator through the advancement of intelligent, connected, wireless gas and radiation detection solutions. Throughout this transaction, RAE Systems management and employees will remain committed to customer service, quality and operating excellence."
Jesse Feldman, Battery Ventures Partner, stated, "RAE Systems has significant long-term market growth potential, and we are excited to partner with the company on driving this growth both organically and through strategic acquisitions. Our prior experience and growing interest in industrial technologies makes RAE Systems a natural investment for Battery. We are eager to support the company through its next phase of evolution and look forward to working with RAE's talented employee base, valuable customer and partner ecosystems, and industry leading technology platform to get there."
A special committee of the RAE Systems Board of Directors and the disinterested members of the board have unanimously approved the agreement and recommend RAE Systems' stockholders approve the transaction.
The company will file a proxy statement with the Securities and Exchange Commission, and a shareholder meeting will be held within 60 days following the SEC's review.
After the completion of this transition, the RAE Systems board of directors will include Mr. Chen and Dr. Peter C. Hsi, co-founders of RAE Systems, who will also remain as stockholders in RAE Systems, as well as Mr. Feldman and Morgan Jones of Battery Ventures.
UBS Investment Bank is acting as financial advisor to the Special Committee of the Board of RAE Systems, and Fenwick & West LLP, is acting as legal advisor to the Special Committee.
Battery Ventures (www.battery.com) has been investing in technology and innovation worldwide since 1983 and supported many breakthrough companies around the world, including Airespace (acquired by Cisco), Akamai Technologies, Inc. (NASDAQ: AKAM), and Omniture (acquired by Adobe). Its current portfolio includes Brightree, Consona, ExactTarget, GreenBytes, HighJump Software, Nova Holdings LLC, Opscode, Rogue Wave Software and Vero Software.