Acxiom Buyout Falls Through, Co. to Receive $65M

ValueAct Capital Partners and Silver Lake Partners, the private-equity buyers who previously agreed to purchase the data-management company Acxiom, have terminated the proposed $2.25B deal, they announced Monday. Acxiom will receive $65 million in cash to terminate the merger agreement, which is less than the $110M termination fee spelled out in the agreement. According to a report in the Wall Street Journal, the two firms will pay $15M-$20M each, while Morgan Stanley and UBS AG, two of the financing banks, will foot the rest of the bill. Bank of America, which also was to participate in the financing, has refused to contribute to the termination fee, according to people familiar with the situation. The Journal report said the reversal comes in the wake of a disappointing earnings report for the fiscal quarter ended in June and expectations the current quarter will be even worse. "Acxiom has been an industry leader for over three decades, and we will continue to execute on our long-term strategy to remain the market leader in database marketing, services and data products," CEO Charles Morgan said in a statement. "While I am disappointed that we could not conclude the merger, we have renewed energy and remain focused and committed to delivering value for our shareholders and clients." Acxiom shares closed Friday at $19.79, well below the $27.10 agreed upon in May. Tensions between ValueAct and Silver Lake also, apparently, contributed to the break-up.

Sources: Press release, Wall Street Journal
Commentary: Credit Squeeze Causing Activists to Back Off Merger Opposition • Silver Lake, ValueAct to Buy Acxiom for $2.25 Billion
Stocks/ETFs to watch: ACXM, UBS, MS. Competitors: DNB, HHS. ETFs: IGV, SWH, PSJ

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