CALABASAS, Calif.–()–On Assignment, Inc. (NASDAQ: ASGN) (“Company”) now announced that it
has sealed a decisive agreement to acquire Apex Systems Inc., a
heading information record staffing and services firm. The
transaction will emanate one of a largest veteran staffing firms
and a 2nd largest IT staffing organisation in a United States.
The merger is approaching to be significantly accretive to On
Assignment’s gain per share, on both a GAAP and money EPS basis, in
2012 and beyond. On a pro forma basis, 2011 income of a combined
entity was $1.3 billion.
“Apex Systems has an considerable lane record of unchanging revenue
expansion and clever margins. The company’s countless achievements and
accolades are a approach outcome of a gifted care team, dedicated
employees and their ability to set assertive goals and execute
accordingly”
Privately-held Apex Systems is a 6th largest and one of the
fastest flourishing IT staffing firms in a United States. In 2011, Apex
Systems had approximately $700 million in income and practiced EBITDA of
approximately $65 million. Apex Systems has achieved a devalue annual
income expansion rate (CAGR) of 30.4% given 2000 and expects to achieve
double-digit top-line expansion in 2012.
“Apex Systems apropos partial of On Assignment serve positions us in the
many appealing and fastest-growing segments of a staffing industry,”
pronounced Peter T. Dameris, boss and arch executive officer of On
Assignment, Inc. “Apex Systems’ IT staffing services are complementary
to those offering by a existent record division, Oxford Global
Resources. Because a offerings do not compete, a merger will
emanate value for a clients, shareholders and employees by expanding
a participation in a IT staffing market. The transaction also achieves On
Assignment’s five-year vital devise to strech $1 billion in annual
income 3 years brazen of schedule.
“Apex Systems has an considerable lane record of unchanging revenue
expansion and clever margins. The company’s countless achievements and
accolades are a approach outcome of a gifted care team, dedicated
employees and their ability to set assertive goals and execute
accordingly,” Dameris added. “This transaction did not take place
overnight. It is a outcome of years of discussions and research to
safeguard it came together in a right way, during a right time and was the
right fit. As a result, integrating Apex Systems with On Assignment
should be a seamless routine and will assent a companies to remain
focused on apportionment a clients and flourishing a business.”
Acquisition Creates a More Diversified and Faster Growing Staffing
Firm
The merger singly positions On Assignment to yield a broader
spectrum of IT staffing offerings, from idea vicious daily IT
services to high-end specialty projects.
“We are anxious to join army with On Assignment. As one of the
largest and many reputable veteran staffing firms in North America,
On Assignment’s success is a covenant to a vital vision,
trained management, unchanging expansion and handling profitability,”
pronounced Win Sheridan, co-founder and co-CEO of Apex Systems.
“We trust a transaction will open a doorway to new opportunities for
a employees as they join a sum height with larger public
visibility, increasing financial firepower and a ability to offer an
even broader array of services for a clients. Furthermore, a absence
of sales channel dispute enables us to continue to concentration on
aggressively pushing top-line growth. We wish to appreciate a employees
whose tough work and loyalty have authorised us to turn one of a most
famous and devoted IT staffing firms in a market,” pronounced Jeff
Veatch, co- owner and co-CEO of Apex Systems.
Apex Systems will continue to work almost as it has in the
past. The company’s 3 co-founders will continue to concentration on Apex
Systems’ plan and a high-performance enlightenment as they have finished for
a final 3 years, and will also have illustration on a On
Assignment house of directors. Rand Blazer and Ted Hanson, Apex Systems’
arch handling officer and arch financial officer, respectively, and
a rest of a comparison government group will sojourn in place and continue
to manage a day-to-day operations of a business.
“This transaction is approaching to be immediately accretive to earnings
per share (without any synergy savings) and beget clever money flow,”
Dameris said. “We demeanour brazen to operative closely with a gifted team
during Apex Systems to take advantage of a many expansion opportunities this
transaction will bring.”
Transaction Details
Under a terms of a decisive agreement, On Assignment will acquire
all of Apex Systems’ equity and retire all of a debt, for a sum of
$600 million. The squeeze cost is comprised of $383 million in cash,
and newly-issued batch valued during $217 million. The transaction is
approaching to be accretive on both a pro forma GAAP and money EPS basement in
2012 and beyond, incompatible transaction-related costs.
In tie with a execution of the definitive agreement, On
Assignment performed a joining for a new $540 million comparison secured
credit facility from Wells Fargo Bank, N.A., Bank of America Merrill
Lynch and Deutsche Bank Trust Company Americas. The credit facility
provides for a $50 million revolving credit trickery and $490 million
tenure loan. The deduction of a tenure loan will be used to financial the
money apportionment of a squeeze price, to repay existent indebtedness of On
Assignment and Apex Systems and to compensate fees and losses in connection
with a transaction.
Upon shutting of a transaction, saved debt of a sum company
will sum approximately 3.75x estimated pro forma practiced EBITDA (as
tangible below) for a twelve months finished Mar 31, 2012. On Assignment
will advantage from carrying a merger treated as an item sale under
territory 338(h)(10) of a IRS code. The choosing is approaching to result
in an estimated $14 million of annual money taxation saving over a subsequent 15
years. On Assignment expects a increasing scale, along with strong
income and giveaway money upsurge generation, to outcome in fast deleveraging,
formulating serve equity value. In tie with a acquisition, On
Assignment intends to make grants of limited batch units covering the
Company’s common batch to certain employees of Apex Systems as
practice provocation awards pursuant to a NASDAQ rules.
The acquisition, that was authorized by a Boards of Directors of both
companies, stays theme to capitulation by On Assignment’s shareholders,
compulsory regulatory approvals as good as other prevalent closing
conditions. The transaction is approaching to tighten in May 2012.
Legal and Financial Advisors
On Assignment defended Latham Watkins LLP as authorised warn and Moelis
Company as disdainful financial advisor. Apex Systems defended Troutman
Sanders LLP as authorised warn and Wells Fargo Securities as exclusive
financial advisor.
Financial Estimates for a Second Half of 2012
Taking a transaction into comment as good as a Company’s normal
anniversary handling patterns, a Company’s financial estimates for the
second half of 2012 are as follows:
- Revenues of $775 million to $805 million
- Gross domain of approximately 30% to 31%
- SGA of approximately $167 million to $178 million1
- Adjusted EBITDA as a commission of income of 10% to 11%12
- Tax rate of 41% to 41.5%
- GAAP gain per share of $0.50 to $0.601
- Cash gain per share of $0.77 to $0.88123
- Fully diluted shares superb of 54,385,000
1 Excludes transaction-related costs and write-offs of
deferred financing expenses
2 Excludes stock-based remuneration expense
3 Excludes amortization of intangibles and includes all tax
advantages from territory 338(h)(10) election
Conference Call and Webcast
On Assignment will horde a discussion call with analysts and shareholders
on Mar 20 during 5:00 p.m. Eastern time. To perspective a concomitant slides,
greatfully revisit a Investor Relations territory of www.onassignment.com.
To listen around telephone, a dial-in series is 877-805-4089 or
281-913-8521 and a discussion ID series is 64210302. Information to
entrance a replay of a discussion call can be found on a website.
About On Assignment
On Assignment, Inc. (NASDAQ: ASGN), is a heading tellurian provider of
rarely skilled, hard-to-find professionals in a flourishing technology,
healthcare, and life sciences sectors, where peculiarity people are a key
to success. The Company goes over relating résumés with job
descriptions to compare people they know into positions they understand
for temporary, contract-to-hire, and approach sinecure assignments. Clients
commend On Assignment for their peculiarity candidates, discerning response,
and successful assignments. Professionals consider of On Assignment as
career-building partners with a abyss and extent of knowledge to
assistance them strech their goals. On Assignment was founded in 1985 and went
open in 1992. The corporate domicile are located in Calabasas,
California, with a network of approximately 88 bend offices throughout
a United States, Canada, United Kingdom, Netherlands, Ireland and
Belgium. Additionally, medicine placements are done in Australia and
New Zealand. To learn more, revisit www.onassignment.com.
About Apex Systems, Inc.
Apex Systems, Inc. is a heading IT Staffing and Services organisation whose main
idea is to bond their clients with experts and learned professionals
who work in Information Technology. Apex Systems specializes in
contract, temp-to-perm and approach placements and offers a accumulation of
other services, including RPO, Statements of Work (SOW) and specialty
ability sourcing. Apex Systems was founded in 1995, now operates in
49 locations opposite a U.S., and is headquartered in Richmond, VA.
Reasons for Presentation of Non-GAAP Financial Measures
Statements done in this recover embody non-GAAP financial measures.
Such information is supposing as additional information, not as an
choice to a combined financial statements presented in
suitability with GAAP, and is dictated to raise an overall
bargain of a stream financial performance. Such measures are
also used to establish a apportionment of a remuneration for some of our
executives and employees. We trust a non-GAAP financial measures
yield useful information to management, investors and prospective
investors by incompatible certain charges and other amounts that we believe
are not demonstrative of a core handling results. These non-GAAP
measures are enclosed to yield management, a investors and
impending investors with an choice process for assessing our
handling formula in a demeanour that is focused on a opening of our
ongoing operations and to yield a some-more unchanging basement for comparison
between quarters. One of a non-GAAP financial measures presented is
Adjusted EBITDA, that we conclude as gain before interest, taxes,
depreciation, and amortization and stock-based remuneration expense,
spoil charges and transaction-related costs. Another non-GAAP
financial magnitude presented is money EPS, that we conclude as net income
and transaction-related costs, write-off of deferred financing
expenses, equity-based remuneration responsibility and amortization of
intangibles, divided by superb shares. These terms competence not be
distributed in a same demeanour as, and so competence not be allied to,
likewise patrician measures reported by other companies.
Additional Information and Where to Find It
In tie with a transaction, On Assignment will ready a proxy
matter to be filed with a SEC. When completed, a decisive proxy
matter and a form of substitute will be mailed to a shareholders of the
Company. BEFORE MAKING ANY VOTING DECISION, ON ASSIGNMENT’S SHAREHOLDERS
ARE URGED TO READ THE PROXY STATEMENT REGARDING THE TRANSACTION
CAREFULLY AND IN ITS ENTIRETY BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. On Assignment’s shareholders
will be means to obtain, but charge, a duplicate of a substitute statement
(when available) and other applicable papers filed with a SEC from
a SEC’s website during http://www.sec.gov.
On Assignment’s shareholders will also be means to obtain, without
charge, a duplicate of a substitute matter and other applicable papers (when
available) by directing a ask by mail or write to On Assignment,
Inc., Attn: Investor Relations, 26745 Malibu Hills Road, Calabasas,
California 91301, telephone: (818) 878-3136, or from a investor
family territory of a company’s website, http://www.onassignment.com.
On Assignment, Apex Systems and their sold directors and executive
officers and other persons competence be deemed to be participants in the
questionnaire of proxies in honour of a transaction. Information
per On Assignment’s directors and executive officers is available
in On Assignment’s notice of annual assembly and substitute matter for its
many new annual assembly and On Assignment’s Annual Report on Form
10-K for a year finished Dec 31, 2011, that were filed with a SEC
on Apr 27, 2011 and Mar 14, 2012, respectively. Other information
per a participants in a questionnaire and a outline of
their approach and surreptitious interests, by confidence land or otherwise,
will be contained in a substitute matter and other applicable materials to
be filed with a SEC.
Safe Harbor
Certain statements done in this news recover are “forward-looking
statements” within a definition of Section 21E of a Securities Exchange
Act of 1934, as amended, and engage a high grade of risk and
uncertainty. Forward-looking statements embody statements per the
Company’s expected financial and handling opening in 2012. All
statements in this release, other than those environment onward strictly
chronological information, are forward-looking statements. Forward-looking
statements are not guarantees of destiny performance, and tangible results
competence differ materially. In particular, a Company creates no assurances
that a financial estimates set onward above will be achieved. Factors
that could means or minister to such differences embody tangible demand
for a services, a ability to attract, sight and keep qualified
staffing consultants, a ability to sojourn rival in receiving and
maintaining substitute staffing clients, a accessibility of qualified
substitute nurses and other competent substitute professionals, management
of a growth, continued opening of a enterprise-wide information
systems, and other risks minute from time to time in a reports filed
with a Securities and Exchange Commission, including a Annual Report
on Form 10-K for a year finished Dec 31, 2011, as filed with a SEC
on Mar 14, 2012. We privately dissent any goal or avocation to
refurbish any forward-looking statements contained in this news release.
Article source: http://www.businesswire.com/news/home/20120320006720/en/Assignment-Acquire-Apex-Systems
