Cubic Board Accepts Revised Acquisition Proposal from Veritas Capital and Evergreen Coast Capital at $75.00 Per Share

Rhea-AI Summary

Cubic Corporation (NYSE: CUB) has accepted a revised acquisition proposal from Veritas Capital and Evergreen Coast Capital, increasing the price to $75.00 per share in cash. This represents a 69% premium over the stock price prior to acquisition interest. The transaction is valued at approximately $3.0 billion, including debt assumption. Cubic's Board determined that this proposal offers superior certainty and timing compared to an alternative offer of $78.00 per share from ST Engineering. A special shareholder meeting is scheduled for April 27, 2021.

Positive

• Acquisition price increased to $75.00 per share, a 69% premium.
• Transaction valued at approximately $3.0 billion.

Negative

• ST Engineering's counteroffer of $78.00 per share was deemed inferior.

Cubic Corporation (NYSE: CUB) (“Cubic” or the “Company”) today announced that it has accepted a proposal from Veritas Capital (“Veritas”) and Evergreen Coast Capital Corporation (“Evergreen”), an affiliate of Elliott Investment Management L.P. (“Elliott”), to increase the price per share of their pending acquisition of Cubic to $75.00 per share in cash. The Company has accepted this proposal and entered into an amendment (the “Amendment”) to its previously announced definitive merger agreement with affiliates of Veritas (the “Merger Agreement” and, as amended, the “Amended Agreement”) to acquire the Company.

Under the terms of the Amended Agreement, Cubic shareholders will receive $75.00 in cash for each share of Cubic’s common stock, representing a premium of approximately 69% to Cubic’s unaffected closing stock price on September 18, 2020, the last trading day before the Company’s disclosure of third-party interest in potentially acquiring Cubic. The all-cash transaction will be valued at approximately $3.0 billion, including the assumption of debt.

Cubic’s Board of Directors (the “Board”) gave due consideration to the revised proposal it received from Singapore Technologies Engineering Ltd (SGX: S63; Bloomberg-STE: SP) (“ST Engineering”) to acquire the Company for $78.00 per share (the “ST Engineering Proposal”). In making its decision, the Board carefully assessed the relative benefits and risks of the proposals from both Veritas and Evergreen and ST Engineering. The Board determined that, based on the superior certainty and anticipated timing of closing the existing transaction with Veritas and Evergreen, the revised proposal from Veritas and Evergreen was in the best interests of all Cubic’s shareholders.

In connection with this determination, the Board (i) approved and adopted the Amended Agreement, (ii) recommends that the Company’s shareholders adopt the Amended Agreement, (iii) recommends that the Company’s shareholders vote “FOR” each of the proposals described in the definitive proxy statement for the Special Meeting of Cubic’s shareholders filed with the United States Securities and Exchange Commission (“SEC”) and mailed to shareholders on or about March 26, 2021, and (iv) determined that the ST Engineering Proposal, after giving effect to all revisions made to such proposal by ST Engineering, is neither a “superior proposal” nor a proposal that would reasonably be expected to lead to a “superior proposal” as that term is defined in the existing Merger Agreement. As a result, Cubic has ceased engagement with ST Engineering in accordance with the terms of the Amended Agreement.

This summary of the Amendment is incomplete, and Cubic encourages shareholders to read the full text of the Amendment to be included with the Company’s current report on Form 8-K, which will be filed with the SEC in due course. Further, the Company intends to provide to its shareholders supplemental disclosure to the definitive proxy statement mailed to the Company’s shareholders on or about March 26, 2021 and will file relevant materials with the SEC. Shareholders are urged to read the definitive proxy statement as supplemented and such other relevant materials for more information, including with respect to the terms of the Amended Agreement.

The Special Meeting of Cubic’s shareholders to adopt the Amended Agreement remains scheduled for April 27, 2021 at 1:00 p.m. Eastern time.

J.P. Morgan Securities LLC is acting as lead financial advisor to the Company and Sidley Austin LLP and Faegre Drinker Biddle & Reath LLP are acting as the Company’s legal counsel. Raymond James & Associates, Inc. provided the Board with an opinion regarding the fairness, from a financial point of view, of the consideration offered to Cubic shareholders.

Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal counsel to Veritas.

Gibson, Dunn & Crutcher LLP is acting as legal counsel to Evergreen.

About Cubic Corporation

Cubic is a technology-driven, market-leading provider of integrated solutions that increase situational understanding for transportation, defense C4ISR, and training customers worldwide to decrease urban congestion and improve the militaries’ effectiveness and operational readiness. Our teams innovate to make a positive difference in people’s lives. We simplify their daily journeys. We promote mission success and safety for those who serve their nation. For more information about Cubic, please visit the company’s website at www.cubic.com or on Twitter @CubicCorp.

About Verita

FAQ

What is the acquisition price for Cubic Corporation by Veritas?

The acquisition price is set at $75.00 per share in cash.

What is the premium offered in the acquisition of Cubic Corporation?

The premium offered is approximately 69% over the unaffected stock price.

What is the total value of the transaction for Cubic?

The total transaction value is approximately $3.0 billion, including debt.

When is the special meeting for Cubic shareholders scheduled?

The special meeting is scheduled for April 27, 2021.

Why did Cubic Corporation reject the ST Engineering proposal?

Cubic's Board found the ST Engineering proposal of $78.00 per share to be inferior.