Captaris to acquire Castelle:
Captaris Inc (NASDAQ: CAPA); a leading provider of software products that automate document-centric business processes announced a definitive agreement to acquire all of the outstanding stock of Castelle (NASDAQ: CSTL). For the year ending 2006, Castelle reported revenues of 10.6 million, net income of $0.7 million and operating cash flow of 1.7 million.
Under the terms of the definitive agreement, which has been unanimously approved by both boards of directors, Captaris will pay $3.95 per share or approximately $10.8 million net of agreed upon closing cash balance for Castelle of $7.4 million. The purchase price per share will be increased or decreased at closing to the extent Castelle's cash is above or below the agreed upon balance, and will be decreased to the extent Castelle's working capital is less than the agreed upon target. The transaction is subject to customary closing conditions including the approval of the shareholders of Castelle, and is expected to close in the third quarter of 2007. Prior to closing, the two companies will continue to operate independently.
“We are very excited about the opportunities ahead of us with the combination of Captaris and Castelle products, customer base and employees” said David Anastacia, President and CEO of Captaris. “Castelle's products broaden our suite of offerings and extend our leadership position in the fax market, particularly for small and medium sized enterprises. Their appliance-based products combining software and hardware into a “plug and play” device, we believe are particularly well suited for our focus on the multi-function printer (MFP) market, the Fax over IP (FOIP) market and for expansion into broader market opportunities.
