SoftSol's Acquisition of Ivon Inc.
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Code : FCF0018
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Region : USA
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Introduction:On April 28, 2010, SoftSol Inc. (SS) announced it would purchase Ivon Inc. (Ivon); a company provider of smartphones powered by NetOS operating system at a price of $5.70 a share for $1.2 billion in an all-cash deal. It was a massive move that SS thought would reshape the mobile industry. The deal would give SS the access to Ivon’s inbuilt software that could run phones and other type of devices like computer tablets. The deal was approved by the shareholders of both the companies. The deal was called to be a strategic one because the smartphone market was around $100 billion in size at that time and was supposed to grow at 20% annually. At that time, Michael Smith (Smith), Executive Vice President and Chief Financial Officer, SS, was considering the advantages and disadvantages of the various options for financing the acquisition of Ivon. At a meeting that concluded on May 14, 2010, there was disagreement among the members of the board of directors of SS as to the best method of financing the acquisition. So, after the meeting concluded, Stuart Jonathen (Jonathen), Chairman and CEO of SoftSol, asked Mr. Smith to assess and analyze all the arguments and opinions put forward by various members of the board and prepare an outline for the next meeting to be held in June. |
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