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Prophet 21, Inc., Yardley, PA, , a provider of business technology software and services to the durable goods distribution market, has entered into an agreement and plan of merger with an entity formed by Thoma Cressey Equity Partners Inc. ('TCEP') and LLR Partners Inc. ('LLR') to effect the merger. Under the Merger Agreement, all of the issued and outstanding shares of common stock and in the money options of Prophet 21 will be acquired for cash in the amount of $16.30 per share. Prophet 21 management will continue to operate the business under its current name and operating structure.
The Board of Directors of Prophet 21 has unanimously approved and adopted the Merger Agreement. The Board of Directors of the company received a fairness opinion from the company's financial advisor, U.S. Bancorp Piper Jaffray. The closing of the merger is subject to customary conditions, including approval by the company's stockholders. Commitment letters have been obtained with respect to all necessary financing and the merger is not subject to a financing contingency. The merger is expected to close in the first calendar quarter of 2003.
As soon as practicable, the company will file a proxy statement with the Securities and Exchange Commission, and will schedule a special meeting of the company's stockholders to vote on a proposal to approve and adopt the Merger Agreement. The company's Board intends to unanimously recommend that the holders of the company's common stock approve and adopt the Merger Agreement. Dr. John E. Meggitt and Dorothy M. Meggitt, the company's founders, majority shareholders and members of its Board of Directors, have agreed to vote in favor of the Merger Agreement.
'We believe Prophet 21 is very well positioned due to its leadership in the industry, domain expertise and innovative product offering,' says Orlando Bravo, a partner with Thoma Cressey Equity Partners. 'This transaction fits very well with our strategy of buying strong franchises in large and fragmented industries. We are excited to be partnering with Prophet 21's proven management team, led by Chuck Boyle, to continue to build the business.'
According to Chuck Boyle, Prophet 21's president and CEO, 'This transaction brings to Prophet 21 the opportunity to move forward more aggressively, to fully leverage our brand equity, leading technology offerings, and market penetration. The management team will own a substantial interest in the business going forward. We are excited to continue to build the business with the financial backing and business expertise of Thoma Cressey Equity Partners and LLR Partners. Their support of Prophet 21 is a powerful endorsement of our business potential.'
LLR also believes strongly in Prophet 21's growth potential. 'As the leader in the enterprise software market for durable goods distributors, Prophet 21 is strategically positioned for significant growth," said Mitchell L. Hollin, a partner with LLR. 'We are very excited that Prophet 21 was the first to market with a true Windows-based solution, CommerceCenter.'
About Thoma Cressey Equity Partners Inc. (TCEP)
Thoma Cressey Equity Partners (TCEP) is one of the leading private equity firms in the country, with a 25-year track record of backing management teams in buyouts, recapitalizations and growth equity transactions. Through its seven funds, TCEP has led over 80 transactions in a wide range of industries. With offices in Chicago and San Francisco, TCEP currently manages over $1.0 billion in private equity capital. TCEP typically invests $10 million to $100 million in businesses valued between $30 million and $300 million. The firm focuses on investments in Business Services, Information Technology, Healthcare and other high growth industries. Investors in TCEP funds include some of the leading government and corporate pension plans, financial institutions, university endowments and national