Privet re-launches US $11.00 non-binding LOI to acquire Norsat

Privet Fund Management LLC announced today it has sent to the board of directors of Norsat International Inc. (TSX: NII; NYSE MKT: NSAT) a letter indicating its interest in acquiring 100% of the common shares of Norsat not already owned at a price of US $11.00 per share in cash pursuant to a plan of arrangement. On March 17, 2017, Privet submitted a non-binding letter of interest (LOI) to acquire Norsat for US $10.25 per share subject to due diligence, financing, the completion of a definitive agreement and other conditions.

Privet owns or controls 1,027,170 common shares of Norsat, representing approximately 17.6% of the outstanding common shares.

The new LOI is non-binding and is subject to to same condition specified in the previous LOI.

The offering price is greater than the US $10.25 per share (US $62 million) offered by Hytera Communications Co., Ltd. announced on March 27, 2017.

Norsat share last traded at CDN $14.27 or US $10.76 as at 10:57 AM EDT, follwing Privet’s new announcement.

Privet shared its belief that this revised indication of interest can reasonably be expected to result in a “Superior Proposal” as defined in the Hytera Agreement. Accordingly, Privet requested access to updated financial and legal diligence information so that it can deliver a “Superior Proposal” in a timely manner.

Further, as Norsat’s largest shareholder, owning approximately 17.6% of the outstanding common shares, Privet expressed disappointment in the ultimate result of Norsat’s negotiations with Hytera. Privet does not view the financial terms of the proposed Hytera arrangement to be in the best interests of Norsat shareholders at this time and expressed substantial doubt that the Hytera arrangement will be approved by shareholders.

Following the receipt of Privet letter, Norsat said at this time the board has not changed its recommendation regarding the pending transaction with Hytera.

Norsat said if, after reviewing the proposal from Privet, the board determines that the offer by Privet is a “Superior Proposal”, it will notify Hytera of that determination. Hytera will then have a period of five business days to offer to amend the terms of the arrangement agreement.

RELATED:
Hytera to acquire Norsat for US $62M

Ted Liu

Ted Liu, M.Sc. (Mining, Queen's), MBA (Finance, Toronto), is the Editor of Private Capital Journal, CanadaMetals.ca, TechWire.ca, and the former Editor of Canadian Private Equity. Ted has been passionately tracking Canadian private capital industry since 1992, having most recently served as Research Director for The Canadian Venture Capital and Private Equity Association (CVCA).

Ted is the architect of CVCA infobase, and is the architect of CPE Media's Financings.ca, Canada's most sophisticated and advanced all private capital and public market financing database.