Black Diamond to Acquire Rapidly Growing Developer of Protective Gear for Action Sports, POC Sweden AB
Black Diamond, Inc. (Nasdaq: BDE) announced that it has entered into a definitive agreement to acquire POC Sweden AB, a Stockholm-based designer and manufacturer of protective gear for action sports athletes.
Founded in 2004, POC produces and distributes to 27 countries advanced-design helmets, body armor, goggles, eyewear, gloves and apparel for action or "gravity sports," like skiing, snowboarding and cycling, with a particular emphasis on safety and protection.
POC, renowned for its research and innovation, is the recipient of numerous industry awards, including the Grand Prize for Active Safety in the prestigious Volvo ISPO Sports Design Award competition. POC's patented technology continues to set new standards for construction, material combinations and engineering for personal protection.
For its fiscal year ended April 30, 2012, POC's unaudited total revenues were approximately $22.5 million, an increase of approximately 35% over the prior year, in spite of a warm and dry winter globally.
Under the terms of the definitive agreement, Black Diamond will purchase POC for 311 million Swedish kronor (SEK) or approximately $43.5 million. At closing, Black Diamond will deliver approximately 460,000 shares of BDE common stock and approximately $40.0 million in cash depending upon the SEK/USD ($) exchange rate at closing. Black Diamond has committed an additional estimated $12.5 million payable in a series of significant, long-term, performance-based incentives payable to management, structured as compensation, with multiple measurement and payment dates over a six and a half year period. The expected total of $12.5 million in compensatory incentive payments are predicated upon aggregate POC contribution margin expected from a 30% compounded annual growth of POC's revenue. Any such performance payments shall be offset by gains imbedded in the vested portion of an employee stock option pool comprised of 500,000 options with exercise prices ranging from $13.00 to $16.00 per share.
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