Planar to be Acquired by Chinese LED Maker Leyard for $157 Million
Leyard pays 51% premium for shares of Planar (PLNR), a leading provider of displays and digital signage. No mention of Runco in the acquisition news.
Leyard Optoelectronic Co., Ltd., a Beijing-based manufacturer of LED display products, has agreed to acquire Planar Systems, Inc. (Nasdaq: PLNR), a leader in display and digital signage technology, and parent company of the residential-oriented Runco video brand.
A U.S. affiliate of Leyard will acquire all of the common stock of Planar for a purchase price of $6.58 per share. The merger values Planar’s equity at approximately $156.8 million on a fully diluted basis.
Planar recently announced financial results for its fiscal third quarter ended June 26, 2015. Total revenue dropped about 3% in Q3 compared to the same time last year, but digital signage was a bright spot for the company.
The category accounted for 60% of Planar’s $42.5 million in total revenue in Q3 and rose almost 20% from the prior year. Some of that comes from Planar’s launch of the DirectLight LED Video Wall System in the second quarter of fiscal 2015.
The $6.58/share acquisition price represents a 42% premium over PLNR’s last closing price and a 51% premium based on a seven-day volume-weighted average price of Planar common stock of $4.35.
No word on what will become of Runco, which Planar acquired in 2007 for $36.7 million in cash. Runco at the time had $55 million in annual sales.
The following is an email to Planar dealers, sent today from Adam Schmidt, VP sales, North America:
Planar announced that we have entered into a definitive merger agreement with Leyard Optoelectronic Co. Ltd., pursuant to which a U.S. affiliate of Leyard will acquire all of the common stock of Planar. You can read more about the transaction and its potential implications here.
As a valued customer and partner of Planar, I wanted to provide you more information as we work through shareholder approvals and other specified closing conditions, anticipating completion of the transaction in the coming months:
- In our discussions with Leyard management, they were attracted to Planar’s strong selling and marketing organizations, customer relationships, history of innovation and overall organizational strength. The Planar executive team that has been guiding the company will remain in place, as Planar will continue to operate as a full service entity under the Leyard umbrella once the transaction closes. The Planar employees you rely on in service, marketing, sales operations, credit, and throughout the company are still here to support you.
- Until the time of the close, Planar and Leyard are two separate companies, with distinct product portfolios and strategies for sales and promotion. Planar does not have access to the Leyard product portfolio or vice versa at this time. Once the transaction is closed we will make decisions on the optimal way to bring the best value to you in terms of products, technology, service and support. As we make those decisions, we will announce them to you via our sales team, Channel Newsletter distributions, in industry publications, and at trade shows and events, as we always have.
- Together, we have delivered outstanding video solutions to thousands of customers. This transaction can add to our abilities to offer you ever-improving technology, products and service. As we contemplate the opportunities for the combined organization, one thing is clear: exciting times are ahead!
If you have questions regarding this announcement, contact your sales manager or myself.
We look forward to helping you grow your business in the coming years as we continue to get bigger, better, and bolder!
All our best –
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