Log in
Show password
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 
  1. Homepage
  2. Equities
  3. Canada
  4. Toronto Stock Exchange
  5. EXFO Inc.
  6. News
  7. Summary
    EXF   CA3020461073


SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector news

EXFO : VIAVI Urges EXFO Special Committee to Uphold Their Fiduciary Duty to Maximize Value for All Shareholders

07/26/2021 | 09:16am EDT

SCOTTSDALE, Ariz., July 26, 2021 /CNW/ -- Viavi Solutions Inc. ("VIAVI") (NASDAQ: VIAV) is once again extremely disappointed that Germain Lamonde, EXFO Inc.'s (TSX: EXF) (NASDAQ: EXFO) ("EXFO") Chairman and majority shareholder, and the EXFO Special Committee have rejected our increased binding proposal (the "Binding Proposal") to acquire EXFO for US$8.00 in cash per share. VIAVI's increased Binding Proposal represents a significant premium of:

  • 116% to the NASDAQ closing price on June 4, 2021, the trading day before the announcement of the going private transaction (the "Going Private Transaction") by Mr. Lamonde;
  • 33.3% to the US$6.00 per share consideration offered under the Going Private Transaction; and
  • 6.7% to VIAVI's previous already-superior proposal to acquire EXFO.

Using his privileged vantage point as Executive Chairman and controlling shareholder, Mr. Lamonde crafted an inadequate, squeeze-out offer of US$6.00 per share to EXFO minority shareholders, priced at the low end of the US$5.75 to US$7.50 valuation range provided by the EXFO Special Committee's own valuator, TD Securities Inc. As is now evident by the EXFO Special Committee's rejection of VIAVI's Binding Proposal, which is exceedingly more favourable from a financial point of view than Mr. Lamonde's Going Private Transaction, the fiduciary out protection contained in the form of a "Superior Proposal" provision in the Arrangement is devoid of any practical effect, in that it cannot lead to the conclusion of a transaction that is more favorable to EXFO's shareholders.

Immediately following VIAVI's first, already-superior proposal, Mr. Lamonde publicly rejected VIAVI's proposal, stating that he would not consider any change of control transaction. He then issued a coercive ultimatum to EXFO minority shareholders: either accept his inadequate US$6.00 per share offer or be forced to continue to hold EXFO shares which, last traded at $3.70 prior to the announcement of the Going Private Transaction on June 7, 2021, and could well return to that trading level in light of Mr. Lamonde's refusal to consider a value-maximizing transaction that would benefit all EXFO's shareholders.

Similarly, the EXFO Special Committee, following Mr. Lamonde's ultimatum, also publicly declined to engage with VIAVI. Disappointingly, they continue to recommend Mr. Lamonde's lower offer and, by refusing to engage with VIAVI, are now depriving minority shareholders of an additional US$2.00 per share in value under VIAVI's Binding Proposal – 33.3% higher than Mr. Lamonde's Going Private Transaction.

Given the significant value and premium we are offering to all EXFO shareholders, we would have expected the EXFO Special Committee, consistent with their fiduciary duties, to work with us to employ every effort to persuade Mr. Lamonde to accept our Binding Proposal, or at the very least, ask Mr. Lamonde to engage with us to see if a deal could be reached that would make sense for all.

Instead, from what we can tell based on the EXFO circular, the EXFO Special Committee has hardly negotiated with Mr. Lamonde. They agreed to lower the projections EXFO management initially prepared after Mr. Lamonde declared them to be "aggressive," and then accepted only his second offer (which was $0.75 above his initial offer).

Shareholders deserve better and the EXFO Special Committee is urged to take this opportunity to work with VIAVI to maximize value for all shareholders in accordance with its fiduciary duty. It is up to Mr. Lamonde and the EXFO Special Committee to explain why they feel Mr. Lamonde's Going Private Transaction is better than VIAVI's Binding Proposal which is US$2.00 per share or 33.3% higher. We do not understand how the EXFO Special Committee could reasonably arrive at this conclusion or continue to recommend and facilitate an inadequate and coercive Going Private Transaction.

We also note that approval of the Going Private Transaction has a "majority of a minority" approval component at the Special Meeting of EXFO shareholders, which excludes all votes attached to shares controlled by Mr. Lamonde. The Going Private Transaction also requires court approval on the "fairness" of the transaction. Completion of the inferior Going Private Transaction will not provide EXFO's minority shareholders with the opportunity to receive full and fair value for their investment.

VIAVI is committed to taking the necessary steps to ensure that its superior Binding Proposal is evaluated on its clear and strategic merits. The combination of VIAVI and EXFO would build a leader in communications test and measurement for the next decade. The strength of the combined teams and technology, combined with significantly greater scale and financial resources, would enable strong investment in growth while achieving greater operating leverage than either company could do alone.

Fried Frank Harris Shriver & Jacobson LLP and McCarthy Tétrault LLP are acting as U.S. and Canadian legal counsel to VIAVI, respectively. Kingsdale Advisors is acting strategic shareholder and communications advisor to VIAVI.

About VIAVI Solutions
VIAVI (NASDAQ: VIAV) is a global provider of network test, monitoring and assurance solutions for communications service providers, enterprises, network equipment manufacturers, government and avionics. We help these customers harness the power of instruments, automation, intelligence and virtualization to Command the network. VIAVI is also a leader in light management solutions for 3D sensing, anti-counterfeiting, consumer electronics, industrial, automotive, and defense applications. Learn more about VIAVI at www.viavisolutions.com. Follow us on VIAVI Perspectives, LinkedIn, Twitter, YouTube and Facebook.

Forward-Looking Statements
This press release contains forward-looking statements including statements and expectations regarding the Proposal, the strategic merits of a transaction between EXFO and VIAVI, VIAVI's expectations regarding growth, scale, financial resources and operating leverage, and VIAVI's plans regarding EXFO's brand, legacy and operations. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. For more information on these risks, please refer to the "Risk Factors" section included in the Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission on August 24, 2020 and our Quarterly Reports on Form 10-Q filed on November 10, 2020, February 9, 2021 and May 7, 2021. The forward-looking statements contained in this press release are made as of the date hereof and the Company assumes no obligation to update such statements.

Additional Information
VIAVI is providing the disclosure required under Section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations applicable to public broadcast solicitations.

Any solicitation made by VIAVI will be made by it (directly or on its behalf) and not by or on behalf of management of EXFO. All costs incurred for any such solicitation will be borne by VIAVI. VIAVI has entered into an agreement with Kingsdale Advisors pursuant to which Kingsdale Advisors has agreed to provide certain consulting and related services. VIAVI may solicit proxies in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, including through press releases, speeches or publications, and by any other manner permitted under applicable Canadian corporate and securities laws. If VIAVI commences any solicitation of proxies, proxies may be revoked by an instrument in writing by a shareholder giving the proxy or by its duly authorized officer or attorney, or in any other manner permitted by law. Neither VIAVI nor, to its knowledge, any of its associates or affiliates, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, (i) in any matter proposed to be acted upon in connection with the Going Private Transaction or (ii) in any transaction since the beginning of EXFO's most recently completed financial year or in or in any proposed transaction which has materially affected or would materially affect EXFO or any of its subsidiaries. Based upon publicly available information, EXFO's head office is located at 400 Godin Avenue, Quebec, Quebec, G1M 2K2, Canada.


Bill Ong
+1 (408) 404-4512

Media (regarding the Proposal)
Hyunjoo Kim
+1 (416) 899-6463

Media (all other inquiries)
Amit Malhotra
+1 (202) 341-8624

View original content to download multimedia:https://www.prnewswire.com/news-releases/viavi-urges-exfo-special-committee-to-uphold-their-fiduciary-duty-to-maximize-value-for-all-shareholders-301340658.html


© Canada Newswire, source Canada Newswire English

Stocks mentioned in the article
ChangeLast1st jan.
EXFO INC. -0.70% 7.805 End-of-day quote.79.84%
VIAVI SOLUTIONS INC. -1.79% 15.87 Delayed Quote.5.98%
All news about EXFO INC.
09/03TITLE : General Counsel and Corporate Secretary (Form 6-K)
09/02EXFO ( “” OR “EXFO : EXFO Inc. (the “Corporation” ..
09/02EXFO : Completes Going-Private Transaction and Begins Delisting of Shares from T..
09/01EXFO : Completes Going-Private Transaction and Begins Delisting of Shares from T..
08/27EXFO : Completes Going-Private Transaction and Begins Delisting of Shares from T..
08/27EXFO : Reports Completion of Going-Private Transaction
08/27EXFO : Completes Going-Private Transaction and Begins Delisting of Shares from T..
08/27EXFO INC.(NASDAQGS : EXFO) dropped from NASDAQ Composite Index
08/27EXFO INC.(NASDAQGS : EXFO) dropped from NASDAQ Telecom Index
08/2711172239 Canada Inc completed the acquisition of 38.5% stake in EXFO Inc..
More news
Analyst Recommendations on EXFO INC.
More recommendations
Financials (USD)
Sales 2020 266 M - -
Net income 2020 -9,54 M - -
Net Debt 2020 13,8 M - -
P/E ratio 2020 -27,4x
Yield 2020 -
Capitalization 356 M 355 M -
EV / Sales 2019 0,67x
EV / Sales 2020 0,81x
Nbr of Employees 1 814
Free-Float 24,4%
Duration : Period :
EXFO Inc. Technical Analysis Chart | MarketScreener
Full-screen chart
Income Statement Evolution
Managers and Directors
Philippe Morin Chief Executive Officer & Director
Germain Lamonde Executive Chairman
Pierre Plamondon Chief Financial Officer & Vice President-Finance
Stephen Bull Vice President-Research & Development
Gabriel Duford Chief Technology Officer
Sector and Competitors
1st jan.Capi. (M$)
EXFO INC.79.84%355
RENISHAW PLC-5.64%5 440