Straight Path board likes unsolicited offer

Straight Path Communications Inc. (NYSE MKT: STRP) board of directors has determined that an unsolicited offer from a multi-national telecommunications company to acquire 100% of the issued and outstanding shares of Straight Path for USD 104.64 per share (reflecting an enterprise value of USD 1.8bn), which will be paid in Bidder stock in an all-stock transaction, constitutes a “Superior Proposal” as defined in Straight Path´s definitive agreement and plan of merger with AT&T Inc. (NYSE: T) and Switchback Merger Sub Inc., the company said.

Under the terms of the AT&T agreement, AT&T agreed to acquire Straight Path in an all-stock transaction in which Straight Path stockholders would receive USD 95.63 per share (reflecting an enterprise value of USD 1.6bn), which would be paid using AT&T stock.

Straight Path has notified AT&T of the Straight Path board´s determination and, pursuant to the AT&T Merger Agreement, AT&T has the option for the next five business days to negotiate a possible amendment of that agreement to match or exceed the bidder´s offer.

Straight Path is not permitted to enter into the Bidder´s merger agreement or to change its recommendation in favor of the AT&T transaction unless, at the end of the Negotiation Period, the Straight Path board determines that the Bidder´s offer continues to constitute a “Superior Proposal” and satisfies certain other requirements under the AT&T Merger Agreement.

The Bidder has stated that its offer will remain outstanding until 11: 59 p.m. New York City time on May 3, 2017.

Under the AT&T Merger Agreement, Straight Path is required to pay a USD 38m termination fee to AT&T if the Straight Path board terminates the AT&T Merger Agreement in order to enter into an agreement with the Bidder. The Bidder has agreed to pay the termination fee to AT&T on Straight Path´s behalf in such event. Straight Path would be required to repay the Bidder for the AT&T termination fee under certain circumstances in connection with a termination of the Bidder´s merger agreement.

Straight Path holds an extensive portfolio of 39 GHz and 28 GHz wireless spectrum licenses. Straight Path is developing next generation wireless technology through its Straight Path Ventures subsidiary. Straight Path holds licenses and conducts other business related to certain patents through its Straight Path IP Group subsidiary.