Financial transaction

VIAVI Announces Increased Binding Proposal to Acquire EXFO at US $ 8.00 Per Share

VIAVI’s binding proposal represents a 33 ⅓% or US $ 2.00 per share premium for the current Private Closing Operation

SCOTTSDALE, Arizona., July 20, 2021 / CNW / – Viavi Solutions Inc. (VIAVI) (NASDAQ: VIAV) today announced an increased binding proposal (the “Proposal”) to acquire all of the outstanding subordinate and multiple voting shares of EXFO Inc. ( TSX: EXF) (NASDAQ: EXFO) (“EXFO”) of US $ 7.50 at US $ 8.00 in cash per share. VIAVI has submitted a binding proposal to EXFO’s board of directors, including a definitive form of arrangement agreement based primarily on the form agreed upon in the proposed closing transaction between EXFO and its president and majority shareholder, Germain lamonde (the “Privatization Transaction”). VIAVI’s increased binding proposal reflects EXFO’s recently announced third quarter 2021 financial results, in which bookings increased 47.2% year-over-year to reach $ 87 million with a book-to-bill ratio of 1.20. EXFO’s sales force reflects both a macroeconomic recovery and secular industry growth demand driven by the deployment of 5G wireless and fiber networks. EXFO’s strong results and future outlook further underpin the shortfall US $ 6.00 consideration of the closure transaction.

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Increased Binding Proposal from VIAVI Delivers Greater Value to EXFO Shareholders
VIAVI’s proposal now values ​​EXFO at approximately $ 459 million on an undiluted basis and represents a significant premium of:

  • 116% at the NASDAQ closing price on June 4, 2021, the trading day preceding the announcement of the closing transaction;

  • 33 % at US $ 6.00 counterpart offer in connection with the going concern transaction; and

  • 6.7% to VIAVI’s previous already superior proposal to acquire EXFO.

In addition, VIAVI’s proposal is superior to the US $ 5.75 at US $ 7.50 The official valuation range of the subordinate voting shares of EXFO prepared by TD Securities Inc., acting as the valuator of the special committee of EXFO in connection with the going concern.

VIAVI’s enhanced proposal allows all EXFO shareholders to recognize significant value for their shares, including Mr. Lamonde, who would receive the same top premium as other shareholders and, given his considerable interest, would greatly benefit from VIAVI’s proposal. Given the significant shareholder value provided under the proposal, we expect the EXFO Special Committee, in accordance with its fiduciary duties to all shareholders, to immediately contact us and Mr. Lamonde and do everything possible. its possible to persuade Mr. Lamonde to support VIAVI’s top deal.

VIAVI is ready to engage with the special committee of EXFO and Mr. Lamonde in order to finalize a definitive arrangement agreement to implement a transaction that is in the best interests of all EXFO shareholders.

Clear strategic merits for the combination of VIAVI and EXFO
There are clear strategic advantages to combining VIAVI and EXFO to build the leader in communications test and measurement for the next decade. The strength of the teams and the technology combined, with a significantly greater scale and financial resources, would allow a significant investment in growth while obtaining greater operating leverage than either of the companies alone. VIAVI values ​​the expertise, skills and experience of key talented EXFO employees and believes their retention and continued engagement are critical to the success of the combination. VIAVI intends to continue the EXFO brand and heritage, recognizing EXFO’s solid reputation based on years of quality product development, engineering excellence and customer service, and continue EXFO’s presence and operations in Quebec complement and extend VIAVI’s long-standing engineering and product development teams in Quebec and Ottawa.

Minimum customary conditions
The board of directors of VIAVI has unanimously approved the proposal and no vote of the shareholders of VIAVI will be required for the transaction. In addition, the transaction will not be subject to any financing condition.

Advisers
Fried Frank Harris Shriver & Jacobson LLP and McCarthy Tétrault LLP are acting as US and Canadian legal counsel to VIAVI, respectively. Kingsdale Advisors is VIAVI’s interim strategic shareholder and communications advisor.

About VIAVI
VIAVI (NASDAQ: VIAV) is a global provider of network testing, monitoring and assurance solutions for communications service providers, enterprises, network equipment manufacturers, government and avionics. We help these customers harness the power of instrumentation, automation, intelligence and virtualization to Control the network. VIAVI is also a leader in light management solutions for 3D detection, anti-counterfeiting, consumer electronics, industrial, automotive and defense applications. Learn more about VIAVI on www.viavisolutions.com. follow us on VIAVI perspectives, LinkedIn, Twitter, Youtube and Facebook.

Forward-looking statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements and expectations regarding the proposal, the strategic merits of a transaction between EXFO and VIAVI, VIAVI’s expectations for growth, scale, financial resources and operating leverage, and VIAVI’s plans for EXFO’s brand, heritage and operations. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. For more information on these risks, please see the “Risk Factors” section included in the Company’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission on 24 august, 2020 and our quarterly reports on Form 10-Q filed on November 10, 2020, February 9, 2021 and May 7, 2021. The forward-looking statements contained in this press release are made as of the date hereof and the Company assumes no obligation to update such statements.

Further information
The information contained in this press release does not constitute, and is not intended to constitute, a solicitation of a proxy within the meaning of applicable Canadian securities laws. It also does not constitute an offer to buy or a solicitation of an offer to sell EXFO shares.

Notwithstanding the foregoing, VIAVI voluntarily provides the disclosure required under section 9.2 (4) of National Instrument 51-102 – Continuous information obligations applicable to solicitations for public distribution.

Any solicitation made by VIAVI will be made by it (directly or on its behalf) and not by or on behalf of the management of EXFO. All costs incurred for such solicitation will be borne by VIAVI. VIAVI has entered into an agreement with Kingsdale Advisors under which Kingsdale Advisors has agreed to provide certain advisory and related services. VIAVI may solicit proxies based on the public disclosure exemption from the solicitation requirements under applicable Canadian corporate and securities laws, including through press releases, speeches or publications, and in any other manner permitted by applicable Canadian corporate and securities laws. If VIAVI begins a solicitation of proxies, the proxies may be revoked by a written deed by a proxy shareholder or their duly authorized officer or agent, or in any other manner permitted by law. Neither VIAVI nor, to its knowledge, any of its partners or affiliates, has a material interest, direct or indirect, through beneficial ownership of securities or otherwise, (i) in any matter that it is proposed to act in connection with the Private Transaction or (ii) in any transaction since the beginning of EXFO’s most recent fiscal year or in or in any proposed transaction that has had or would have a material impact on EXFO or one of its subsidiaries. According to publicly available information, EXFO’s head office is located at 400, avenue Godin, Quebec, Quebec, G1M 2K2, Canada.

Surveys:

Investors
Bill Ong
+1 (408) 404-4512
[email protected]

Media (regarding the proposal)
Hyunjoo Kim
+1 (416) 899-6463
[email protected]

Media (all other requests)
Amit Malhotra
+1 (202) 341-8624
[email protected]

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SOURCE VIAVI Finances

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