By Lisa Kerner
Charlotte, N.C., June 22 - Voyager Learning Co. and Cambium Learning, Inc. agreed to combine to create "a leading provider of education intervention services in the United States," the companies announced on Monday.
A newly formed company, Cambium-Voyager Holdings, Inc., will acquire both companies and issue shares in the combined company to Voyager and Cambium stockholders.
Cambium-Voyager Holdings will be majority owned by VSS-Cambium Holdings III, LLC, which will be majority owned by private equity investor and Cambium owner Veronis Suhler Stevenson.
"The timing is ideal to combine forces to offer products and services that address the critical needs of an estimated $4.5 billion annual market," Scott Troeller, partner at Veronis Suhler Stevenson, said in a news release.
Once the merger is complete, Cambium-Voyager Holdings will be a Dallas-based public company and expects to trade on the Nasdaq Global Market.
The merger agreement calls for Voyager stockholders to receive either one share of common stock of Cambium-Voyager Holdings or $6.50 in cash. Shareholders will also receive a pro rata amount of certain tax refunds received by Voyager prior to the closing of the transaction and a contingent value right.
Voyager shareholders will receive total consideration of approximately $194 million, excluding the contingent value rights and distributions of certain tax refunds, the companies said.
The amount of cash available for cash elections is $67.5 million.
Cambium's sole stockholder will receive total consideration of approximately $158 million, excluding warrants, consisting of 20,454,312 shares of Cambium-Voyager Holdings common stock valued at $6.50 per share.
The combined company will assume about $168 million of Cambium Learning debt for total consideration under the merger agreement of approximately $520 million.
A $4.5 million termination fee is included in the agreement, according to a form 8-K filed with the Securities and Exchange Commission.
Voyager president Ron Klausner will be chief executive officer of the combined company, and Dave Cappellucci, CEO of Cambium, will become president.
The board of directors of Cambium-Voyager Holdings will consist of five directors designated by Cambium and four designated by Voyager, including Richard Surratt.
Surratt will cease to be president and CEO of Voyager once the merger is complete.
The transaction is expected to be completed in October subject to Voyager shareholder approval.
Cambium is a Natick, Mass., education company that provides intervention services for literacy and mathematics.
Dallas-based Voyager publishes various solutions for the U.S. educational market.
| Acquirer: | Cambium Learning, Inc.
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| Target: | Voyager Learning Co.
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| Announcement date: | June 22
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| Price per share: | $6.50
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| Termination fee: | $4.5 million
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| Expected closing: | October 2009
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| Stock price of Voyager: | Pink Sheets: VLCY: $3.96 on June 19
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