Affiliated Computer Services Inc. announced this morning it has received a buyout offer from its founder, Darwin Deason, and private-equity fund Cerebus Capital Management. The offer of $59.25/share -- a 16% premium on Monday's closing price of $51.29 -- values the company at about $6 billion, and $8.2 billion including debt that would either be refinanced or remain outstanding. According to the Wall Street Journal, in 2005 a group of private-equity funds almost bought ACS, but the deal was thwarted by Deason. Affiliated later became caught up in the options-backdating scandal, although Deason has not been implicated to date. Deason owns 40% of all outstanding shares, and holds supervoting control over a second class of stock, which gives him the ability to control the company's fate. The people said that Deason would entertain higher offers. Citigroup is funding the deal, and has issued a "highly confident" letter that it will raise the necessary financing. Deason: "I believe that this offer and our proposed process will maximize value for all of ACS's shareholders." He said he would continue as Executive Chairman. ACS shares are up 16.4% to $59.70 in pre-market trading.
Sources: Press Release, Wall Street Journal, MarketWatch
Commentary: Good News? Top Affiliated Computer Execs Resign Over Options Flap
Stocks/ETFs to watch: Affiliated Computer Services Inc. (ACS). Competitors: Accenture Ltd. (NYSE:ACN), Computer Sciences Corp. (CSC), Electronic Data Systems Corp. (NASDAQ:EDS)
Conference call transcript: Affiliated Computer Services F2Q07 (Qtr End 1/31/07) Earnings Call Transcript
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