SCHAUMBURG, Ill. and LAKE OSWEGO, Or – 21 DEC
2006 – Motorola, Inc. (NYSE: MOT) and Tut Systems, Inc. (Nasdaq: TUTS) today
announced that the two companies have signed a definitive merger agreement,
under which Motorola will acquire all of the outstanding shares of Tut Systems
common stock for $1.15 per share in cash. The transaction has a total equity
value of approximately $39 million on a fully-diluted basis.
Tut Systems provides carrier-class end-to-end digital video encoding,
processing and distribution products. Their solutions support MPEG-2 and MPEG-4
AVC video compression, local ad insertion, forward error correction, and
real-time conditioning of video and audio. Today, more than 160 service
providers worldwide deliver IPTV powered by Tut Systems digital video
distribution technology.
The integration of Tut Systems’ solutions with Motorola’s industry-leading
digital video delivery solutions will expand Motorola’s ability to help service
providers deploy advanced video services over IP, ATM, or RF-based network
architectures. Motorola currently has deployed 2060 digital video networks and
over 50 million digital video set tops worldwide.
"This transaction brings together the telco-aware IPTV processing
capabilities of Tut Systems with Motorola’s proven video delivery expertise.
Together, our combined portfolio will provide service providers with
next-generation solutions for delivering rich video experiences into the
connected home – and out into the world,” said Dan Moloney, President, Motorola
Connected Home Solutions. “"We look forward to adding the great people,
technology and video expertise of Tut Systems to the Motorola Connected Home
Solutions team."
“Today is an exciting day for Tut Systems. Our stockholders will be
able to receive value for their investment, while our employees, customers and
strategic partners will benefit as we join together with Motorola, an
established, global leader in architecting and deploying digital and IP video
networks," said Sal D'Auria President and CEO of Tut Systems. “Motorola’s
financial resources and customer relationships will enable us to address larger
customer opportunities that were challenging as a smaller company. My
team is committed to working closely with Motorola to ensure a rapid and
seamless transition.”
Upon completion of the transaction, Tut Systems will become a wholly-owned
subsidiary of Motorola and will be integrated into the Motorola Connected Home
Solutions business. Motorola intends to maintain Tut Systems’ operations in
Lake Oswego, Oregon, San Diego California and Pleasanton California.
The transaction is expected to be neutral to Motorola’s earnings per share in
the first year following closing, excluding certain non-cash charges relating
to amortization associated with acquired intangibles and other one-time
accounting and transaction-related costs. The transaction is subject to
customary closing conditions, including regulatory approvals and the approval
of Tut Systems’ stockholders, and is expected to be completed in the first
quarter of 2007.
About Tut Systems, Inc.
Tut Systems, Inc. delivers advanced content processing and distribution
products as well as comprehensive system integration services for deploying
next-generation data and video services over broadband networks. Service
providers, content providers and government agencies worldwide use Tut Systems
solutions to deliver broadcast-quality video over broadband networks.
Tut Systems is headquartered in Lake Oswego, OR. For more information, visit www.tutsys.com
Source: Motorola press release
