Renaissance Learning (NASDAQ:RLRN)
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AlphaSmart, Inc. to Merge With Renaissance Learning(R), Inc.:
Companies Positioned to Provide Breakthrough Solutions for Writing
LOS GATOS, Calif., Jan. 25 /PRNewswire-FirstCall/ -- AlphaSmart, Inc.
(NASDAQ:ALSM), a provider of affordable, portable personal learning solutions
for the K-12 classroom, today announced that it has reached a definitive
agreement to merge with Renaissance Learning, Inc. (NASDAQ:RLRN), a leading
provider of learning information systems and school improvement programs for
pre-K-12 schools. AlphaSmart and Renaissance Learning expect that this merger
will enable the combined companies to offer a unique suite of writing products,
enhance some of Renaissance Learning's other software products and broaden the
market channels for the AlphaSmart product lines. Renaissance Learning plans
to operate AlphaSmart as a wholly-owned subsidiary and retain the AlphaSmart
brand.
Under the agreement, unanimously approved by the boards of directors of both
companies, each AlphaSmart stockholder will receive $3.75 per share. The
transaction is intended to be structured as a tax-free reorganization and is
valued at approximately $57 million. AlphaSmart stockholders will have the
option to be paid in cash, stock or some combination of the two, subject to
pro-ration so that the total consideration paid will aggregate no more than 45%
stock and no less than 55% cash. The merger, which is expected to be completed
in the second quarter of 2005, is subject to approval by AlphaSmart
stockholders, government regulatory review, and other customary closing
conditions described in the definitive agreement. Voting agreements supporting
the merger have been executed by AlphaSmart stockholders who hold approximately
60% of the outstanding shares, including its three founders.
"The addition of AlphaSmart's exceptional product line and talented
professional staff will strengthen and diversify Renaissance Learning's
position as a leading provider of learning information systems to schools,"
said John Hickey, president and chief executive officer of Renaissance
Learning. "Together, we will be able to provide unique breakthrough solutions
to help educators develop student writing skills along with strengthening other
Renaissance solutions where limited computer access is a bottleneck to daily
program use. In addition to the merger providing substantial growth potential
for the combined companies, we expect to achieve annual savings of at least $1
million from the reduction of redundant public company and other costs."
"By offering AlphaSmart portable computer-companion products with Renaissance
Learning software, we will be able to help K-12 districts leverage the use of
their existing classroom computers, thereby increasing the value derived from
their technology investment," said Ketan D. Kothari, chairman and chief
executive officer of AlphaSmart. "Our solutions are highly complementary, and
we expect that this merger will help grow the revenues of the combined
companies and accelerate learning of writing and other subjects."
AlphaSmart also announced today that James M. Walker, vice president, chief
financial officer and chief operating officer, has been appointed president and
chief executive officer of Alara, Inc., a privately held provider of Storage
Phosphor Technology (SPT) imaging systems for a variety of medical
applications. Walker has served on Alara's board of directors since the
company's founding in 1994 and as chairman of the board since 1996. In
addition to his role at Alara, Walker has indicated that he plans to continue
serving as AlphaSmart's vice president, chief financial officer and chief
operating officer until the close of the merger with Renaissance Learning.
Renaissance Learning will hold a brief conference call at 3:30 p.m. CST today
to discuss the merger. The teleconference may be accessed by dialing
888-868-9083 at 3:30 p.m. CST. Please call a few minutes before the scheduled
start time to ensure a proper connection. A digital recording of the
conference call will be made available from January 25, 2005 at 8:00 p.m. CST
through February 1, 2005 at 11:59 p.m. CST. The replay dial-in is
877-519-4471. The conference ID number to access the replay is 5635124.
AlphaSmart, Inc.
AlphaSmart, Inc. is a provider of affordable, portable personal learning
solutions for the K-12 classroom. Its portable computer-companion products are
used by students to enhance writing, keyboarding and comprehension, and have
been adopted by more than 8,000 school districts in the United States and other
countries. Based in Los Gatos, California, the company was founded in 1992 by
former Apple Computer engineers.
Renaissance Learning(R), Inc.
Renaissance Learning, Inc. is a leading provider of research-based learning
information systems software, school improvement programs, teacher training,
and consulting. Adopted by more than 67,000 schools, Renaissance Learning
information technology products give students and teachers continuous
constructive feedback that helps motivate students, dramatically accelerate
learning, improve test scores, and help students master all standards, while
reducing teacher paperwork. Renaissance Learning has six U.S. locations and
subsidiaries in Australia, Canada, India, and the United Kingdom.
This press release contains forward-looking statements made pursuant to the
safe harbor provision of the Private Securities Litigation Reform Act of 1995,
including statements regarding the expected impact the merger will have on the
combined companies. Any such forward-looking statements may involve risks and
uncertainties that could cause actual results to differ materially from any
future results encompassed within the forward-looking statements. Factors that
could cause or contribute to such differences include the risk that
AlphaSmart's business may not be integrated successfully; failure to satisfy
the closing conditions; an unexpected increase in the costs related to the
merger; unexpected delays in closing the merger; and other risks affecting
AlphaSmart's and Renaissance Learning's businesses described in their
respective filings with the Securities and Exchange Commission, including
AlphaSmart's 2004 Quarterly Reports on Form 10-Q, and Renaissance Learning's
2003 Annual Report on Form 10-K and later filed Quarterly Reports on Form 10-Q,
which factors are incorporated herein by reference. AlphaSmart and Renaissance
Learning expressly disclaim a duty to provide updates to forward-looking
statements, whether as a result of new information, future events or other
occurrences.
Additional Information
AlphaSmart and Renaissance Learning intend to file a registration statement on
Form S-4, which will include a proxy statement/prospectus and other relevant
materials in connection with the proposed merger transaction involving
AlphaSmart and Renaissance Learning. INVESTORS AND SECURITY HOLDERS ARE URGED
TO READ THIS FILING WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION REGARDING THE PROPOSED MERGER TRANSACTION. Investors and security
holders may obtain free copies of these documents and other documents filed
with the SEC when they become available at the SEC's website at
http://www.sec.gov/. In addition, investors and security holders may obtain
free copies of the documents filed with the SEC by AlphaSmart at AlphaSmart's
website at http://www.alphasmart.com/ or by contacting AlphaSmart investor
relations at or via telephone at 408-355-1029. Investors and security holders
may obtain free copies of the documents filed with the SEC by Renaissance
Learning by directing such requests to Renaissance Learning, Inc., Attention:
Corporate Secretary, 2911 Peach Street, P.O. Box 8036, Wisconsin Rapids,
Wisconsin 54995 or via telephone at 715-424-3636.
Renaissance Learning, AlphaSmart and their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies from
the stockholders of AlphaSmart in connection with the merger transaction.
Information regarding directors and executive officers of AlphaSmart and
Renaissance Learning and their respective interests in the proposed transaction
will be available in the proxy statement/prospectus of AlphaSmart and
Renaissance Learning described above and other relevant materials to be filed
with the SEC.
NOTE: AlphaSmart is a registered trademark of AlphaSmart, Inc. in the United
States and other countries. All other trademarks are the property of their
respective owners.
DATASOURCE: AlphaSmart, Inc.
CONTACT: investors, Ketan D. Kothari, Chief Executive Officer of
AlphaSmart, Inc., +1-408-355-1029, or
Web site: http://www.alphasmart.com/