Newsletter Desktop Newsletter Mobile

Arotech Corp. has agreed to a deal in which an affiliate of Greenbriar Equity Group L.P. will acquire all outstanding shares of Arotech common stock for $3 per share in cash.

The deal has an aggregate equity value of approximately $80.8 million. The $3 per share cash consideration represents a premium of approximately 32.7% to Arotech’s closing share price on Sept. 20, the last full trading day before the announcement of the deal. The transaction, which was unanimously approved by Arotech’s board of directors upon recommendation by a special committee of the board, is expected to close in the first quarter of 2020.

Following completion of the transaction, Arotech, a defense and security company, expects it will remain headquartered in Ann Arbor.

Arotech’s board, with the assistance of its financial adviser, will conduct a 30-day “go-shop” process following the date of the announcement of the merger agreement, during which it will actively initiate, solicit, facilitate, encourage and evaluate alternative acquisition proposals, and potentially enter into negotiations with any parties that offer alternative acquisition proposals. Arotech will have the right to terminate the merger agreement to accept a superior proposal, subject to the terms and conditions of the merger agreement.

There can be no assurance that this “go-shop” process will result in a superior proposal or that any other transaction will be approved or completed, and Arotech does not intend to disclose developments with respect to the solicitation process unless and until its board makes a determination requiring further disclosure.

The proposed transaction is subject to, among other customary closing conditions, approval by the holders of a majority of the shares of Arotech common stock. There are no financing contingencies contemplated under the terms of the merger agreement. Following completion of the transaction, Arotech will become a privately-held company and shares of Arotech’s common stock will no longer be listed on any public market.

B. Riley FBR Inc. is serving as exclusive financial adviser to Arotech, and Lowenstein Sandler LLP is serving as legal counsel. Kirkland & Ellis LLP is serving as legal counsel to Greenbriar.

Arotech is incorporated in Delaware, with corporate offices in Ann Arbor and research, development and production subsidiaries in Michigan, South Carolina and Israel.