Datastream Systems, Inc., Greenville, SC, announced that, after careful consideration, its board of directors unanimously rejected an unsolicited offer by MRO Software, Inc. to purchase all of the outstanding shares of Datastream for $6.00 per share, comprised of $1.00 per share in cash and $5.00 per share in MRO Software common stock. The board determined the MRO Software offer is inadequate, does not reflect the inherent value of the company, and is not in the best interests of Datastream or its stockholders. Letter follows:
Larry G. Blackwell, Chairman of the Board of Datastream Systems, Inc., sent the following letter, dated January 8, 2002, to Mr. Robert Daniels, Chairman of the Board of MRO Software, Inc.:
Dear Mr. Daniels:
As we indicated to you in a letter dated December 21, 2001, we received your letter dated December 20, 2001 and provided copies of it and your press release of the same date to our Board of Directors and advisors. Our Board carefully and thoroughly considered the offer contained in your letter and has voted unanimously to reject your offer and to decline to enter into negotiations with MRO Software regarding a business combination with Datastream. As further explained below, our Board of Directors has reviewed Datastream's strategic plan, the investments we have made and the momentum we are building and has concluded that the long-term interests of our stockholders are best served by Datastream remaining independent. We are not for sale to MRO Software or any other third party at this time.
We strongly disagree with the statement in your December 20 offer that the combination of our companies would provide "undeniable value and liquidity" to Datastream's stockholders. First, our Board of Directors has concluded that your offer is inadequate, and does not reflect the true value of Datastream. Not only is the overall offer extremely low, the cash component represents less than our cash on hand. Furthermore, in our judgment, the value of the MRO Software common stock component of your offer is subject to substantial market risk. Your common stock is extremely volatile and was trading at less than half its current trading price only 90 days ago. The trading history of MRO Software common stock offers no certainty of value to Datastream's stockholders.
We are absolutely committed to the long-term success of our customers, which includes more than 75% of the Fortune 50, and more than 65% of the Fortune 500. For reasons of technology, total cost of ownership, ease-of-use, and support, the best path forward for our customers, and prospects, is Datastream. Our Datastream 7iTM product, the only fourth generation web product with thousands of users in the EAM space, has met with significant success in the corporate enterprise. It is only appropriate that we continue to support our customer base with the best technology available, Datastream 7i.
Our Board of Directors and our management are committed to maximizing the value of our stockholders' investment, and in doing so, strive to maintain the highest standards of responsibility to our customers and employees. Consistent with our fiduciary duty to our stockholders, we must therefore reject your offer.