Lineage Power To Acquire Cherokee International; Names New CEO
Cherokee International announced that it has entered into a definitive merger agreement with Lineage Power Holdings, Inc., a Gores Group company, under which Lineage will acquire all of the outstanding shares of Cherokee International. Under the terms of the agreement, stockholders of Cherokee will receive $3.20 per share of common stock held, in an all cash transaction, representing an aggregate enterprise value of approximately $105 million. The transaction has been unanimously approved by the board of directors of Cherokee International, and certain stockholders have agreed to vote their Cherokee shares in favor of the transaction.
"We believe the sale of Cherokee to Lineage will add value and scale for our customers," said Jeffrey Frank, Cherokee’s President and Chief Executive Officer. "Over the past 30 years, Cherokee has earned a great reputation for our strong engineering team, manufacturing, quality and responsiveness, all of which come down to our outstanding employees and our focus on the customer. Going forward, our employees and customers will be well served by becoming part of Lineage and The Gores Group portfolio of companies. Gores has a stellar reputation for customer satisfaction and the proven ability to profitably grow its businesses."
According to Ryan Wald, Managing Director of The Gores Group, Cherokee will become a division of Lineage and will continue to be a leader in the custom power solutions marketplace. "We are impressed by the accomplishments that Jeff and his management team have made to date regarding Cherokee’s North American and Asian operations, We look forward to partnering with them in those regions to create a more compelling value proposition for our combined customers."
The transaction is subject to the approval of Cherokee International’s stockholders and to regulatory approvals. The companies anticipate that the transaction will be completed in the fourth calendar quarter of 2008.
Lineage Power also announced that its board of directors has named Craig A. Witsoe as the new Chief Executive Officer. Witsoe recently served as President and CEO of Tyden Group, a producer of product identification and cargo security technology. At Tyden, Witsoe globalized operations while driving growth through new product introductions and global sales expansion.
