Canon U.S.A., Inc. - 11/16/2009
Canon and Océ to Create Global Leader in Printing Industry
Canon and Océ today announced that they have reached conditional agreement to combine their printing
activities through a fully self-funded, public cash offer by Canon for all the Shares of Océ. The offer price of
€ 8.60 per Share of Océ (the “Offer”) represents a premium of 70% over the closing share price of Friday 13
November 2009 and 137% to the average closing price of Océ’s Shares over the last 12 months. The Offer
values 100% of the issued and outstanding Shares of Océ at approximately € 730 million.
Canon and Océ aim to create the overall No. 1 presence in the printing industry, building on an enhanced
scale and a combined history of innovation and excellent client servicing. The combination will capitalize on
an excellent complementary fit in product mix, channel mix, R&D, and business lines resulting in an outstanding
client offer spanning the entire printing industry.
Canon’s President and COO Tsuneji Uchida says:
“We are delighted to welcome Océ, the ideal partner in every respect, into the Canon Group. Through the
merger of Canon and Océ, we believe that we will be able to realize clear benefits, not only in the area of R&D,
but also in terms of product mix and marketing and are confident that this winning combination will contribute
greatly to our goal of becoming the overall No. 1 presence in the printing industry.”
Océ’s CEO Rokus van Iperen says:
“I am very much looking forward to joining forces with Canon. There is a great fit between our companies,
which share similar values and a strong commitment to technology and innovation. I am proud Canon intends
to team up with Océ, based upon the prominence of our customers and technology and of course our people
that have shaped our company for generations.
This is the best possible combination in the consolidating global printing industry and will deliver scale in R&D,
manufacturing and distribution. The combined organization provides us with access to a huge sales network
in Asia as well as mutual cross selling opportunities in Europe and the United States. Our customers will
benefit from an outstanding product and services offering and our employees will be offered appealing
Canon and Océ will be able to build upon each other’s strong history and proven track record of innovation and
customers servicing and create a strong joint enterprise capable of long term successes. The similar technology
oriented background and corporate values will be important drivers creating the world’s leading group in the
Canon and Océ have similar backgrounds in corporate values with a client oriented culture and a technology
driven business model. Océ, one of the world’s leading providers of document management and printing for
professionals, brings to the merger its expertise and strengths in the areas of production printing, wide format
printing and business services. Océ’s strategy focuses on strengthening its distribution power, increasing
product competitiveness and improving operational excellence. The combination will provide Océ access to
Canon’s well-established sales and marketing network throughout Asia. Additionally, Océ will benefit from the
Canon Group Best in Class processes and infrastructure as well as financing to facilitate active investment
toward the expansion of Océ’s business operations. The combination of Canon and Océ will have leading
positions in the SOHO (Small Office/Home Office), office, production and wide format segments, offering a
superlative range of products and services. It would be able to provide optimal customer servicing through its
enhanced scale, innovative technologies and strong distribution networks. Océ and Canon have complementary
technologies and products and would benefit from improved diversification across regions and businesses.
Under Phase III of its Excellent Global Corporation Plan, launched in 2006, Canon aims to join the ranks of the
world’s top 100 companies in terms of all key measures of business performance. As a principal strategy toward
the realization of this goal, Canon aims to achieve the overwhelming No. 1 position worldwide in all of its current
core businesses. Océ boasts a robust direct sales and service network in 32 countries, which will provide
valuable additional sales and service support for Canon-brand products. Furthermore Canon will benefit from
the addition of Océ’s production and wide format printing line-up, along with the R&D synergies made possible
through joint development initiatives in these areas.
The printing industry currently is in a period of consolidation, driven by the undeniable fact that scale is
increasingly important, especially in R&D and manufacturing. Only players that are able to improve profitability
through increased scale and Best in Class processes and infrastructure will play a leading role in the printing
industry going forward. In this perspective, Canon and Océ form the ideal combination. Together they are
excellently positioned to optimize the servicing of their customers and become the undisputed market leader.
Océ’s position in the combination
Following the completion of the merger, Océ will remain a separate legal entity and will become a division within
Canon with headquarters in Venlo (the Netherlands). Océ will be responsible worldwide for wide format,
commercial printing and business services. Océ’s office activities will be integrated in Canon’s Office Imaging
Products division (“OIP”). Canon’s Large Format Printing will functionally be integrated in the Océ Production
Printing Division (“Océ division”) over time.
In order to create optimal scale in the right segments, the Océ division will report (managerial and financially) to
the Canon Board and will lead the R&D and manufacturing for its businesses. Furthermore, Océ’s headquarters,
combining R&D, production and sales functions, is expected to play an integral role for Canon’s European
regional operations, one of Canon’s key bases within its Three Regional Headquarters vision. The current
Management Board and key management of Océ will remain in place. In the Océ division, the strong Océ
brand name will be maintained and will be applied in all relevant markets.
Following completion of the Offer the Management Board of the Océ division will consist of the following
persons: Messrs. Van Iperen, Kerkhoven and Schaaf. Océ’s Supervisory Board will include the following
persons: Messrs. Tanaka, Elverding and Baan, as well as three additional persons to be selected among
Canon’s top executives.
The integration of both Canon and Océ businesses will take place over the coming 3 years. Canon and Océ
have agreed on a high level integration plan and integration project organization. The integration will be aimed
to optimize efficient coordination of Sales, Service, Marketing, R&D and Manufacturing & Logistics covering all
business areas, the process of which will be directed and supervised by a Steering Committee composed of
executives from Canon and Océ. The Sales and Service integration will be led by joint integration teams per
region with initially two dedicated organizations, respectively for the OIP and for the Océ division.
The Océ employees will become part of a global leader in the printing industry which will capitalize on the strong
brands of both companies. Océ and Canon do not expect that there shall be any material negative
consequences as a result of the Offer for the existing employment level of Océ, excluding already announced
personnel reductions. The combination will respect the existing rights of the employees of Océ, including
applicable covenants with the Océ works councils and the unions, the applicable social plans and collective
labor agreements. The combination will also respect the current obligations with respect to the pension rights of
The customers of both Canon and Océ will benefit from an enlarged range of high quality products and services
through an extended global sales and service network.
Océ will carefully explore with its various business partners the future of their relationship in view of the
Financial highlights of the Offer
Canon intends to acquire all the outstanding Shares of Océ through a fully self-funded cash offer consisting of
€ 8.60 in cash per ordinary Océ Share, representing:
o a 70 % premium over Océ closing price on Friday 13 November 2009;
o a 137 % premium over Océ’s average twelve months share price.
No further dividends are expected to be declared prior to the completion of this Offer.
Bestinver Gestion S.A. SGIIC, a holder of approximately 9.5% of the outstanding Shares, has committed itself to
tender its Shares under the intended Offer when it is made. The irrevocable contains certain customary
undertakings and conditions including that the shareholder will only tender its Shares to a bona fide third party
offeror at a price of at least 10% above the Offer. Canon will have the right to match any competing offer.
Ducatus N.V., ASR Nederland N.V. and ING AM Insurance Companies B.V., each holder of depository receipts
for cumulative preference shares in Océ and Stichting Administratiekantoor Preferente Aandelen Océ, which
holds on their behalves all the cumulative preference shares representing in aggregate approximately 19% of
Océ’s voting rights, have entered into a conditional agreement with Canon to transfer their depository receipts
and cumulative preference shares, respectively, on the condition of the Offer being declared unconditional.
The Management and Supervisory Boards of Océ fully and unanimously support the transaction with Canon,
after giving due consideration to the strategic, financial and social aspects of the transaction and taking into
account the interest of the shareholders and all other stakeholders of Océ, including clients and employees.
The Management and Supervisory Boards of Océ will recommend to the shareholders that they accept the Offer.
Financing of the Offer
The cash consideration of the Offer is € 730 million, based on a 100% acceptance of Océ’s ordinary shareholders.
The cash consideration for depository receipts for cumulative preference shares amounts to
€ 65 million. Canon intends to refinance short and long term debt of Océ, as needed. As per 31 August 2009,
the total amount of short and long term debt amounted to € 704 million. Canon will finance the Offer and debt
repayment from internally generated funds.
Offer Conditions and Process
The Offer will commence after the formal filing with the AFM (Dutch Authority Financial Markets) of an Offering
Memorandum. The commencement of the Offer is subject to the satisfaction of certain pre-offer conditions
customary for a transaction of this kind, such as (i) relevant antitrust clearances for the Offer, (ii) no revocation
of the recommendation by Océ’s Management Board or Supervisory Board, (iii) no revocation of the agreements
with the Committed Shareholders, (iv) no competing offer having been made, (v) no order, stay judgment or
decree restraining, prohibiting or delaying the transaction, (vi) agreement on and AFM approval of the Offering
Memorandum, (vii) no material breach of the merger protocol and (viii) no material adverse change having occurred.
When made, the consummation of the Offer will be subject to the satisfaction or waiver of certain offer conditions
customary for transactions of this kind, such as (i) a minimum acceptance of 85% of the Shares on a fully diluted
basis, (ii) no revocation of the recommendation by Océ’s Management Board and Supervisory Board, (iii) no
revocation of the agreements with the Committed Shareholders, (iv) no competing offer having been made, (v)
no order, stay judgment or decree restraining, prohibiting or delaying the transaction, (vi) no material breach of
the merger protocol and (vii) no material adverse change having occurred.
Océ may terminate the conditional agreement with Canon in the event that a bona fide third party makes an
offer which is, in the reasonable opinion of Océ’s Management Board and Supervisory Boards, superior to the
Offer. An alternative offer shall only be regarded as superior in the event its bid price exceeds the Offer price by
10%, or in the event of a consecutive bid by 5%. Canon has a right to match a superior offer. In the event the
conditional agreement is terminated pursuant to a competing offer, Océ shall pay to Canon an amount of
€ 7,950,000 as compensation for opportunity costs and other costs incurred by Canon.
The relevant bodies and authorities (such as the relevant employee representative bodies, the AFM, the Social
Economic Council and the relevant antitrust authorities) have been or will be informed and/or consulted (as
applicable), as customary in a transaction of this kind.
If the Offer is declared unconditional, it is intended that Océ’s listing on the Official Market of NYSE Euronext
Amsterdam N.V. will be terminated as soon as possible.
In the event that the Offer is declared unconditional and less than 95% of the Shares is acquired, Canon may
utilize available legal measures (for example a legal merger and squeeze out) in order to increase their ownership
to 100% of the total share capital of Océ.
The Offering Memorandum is expected to be published and the Offer is expected to commence in the first
quarter of 2010;
Following the publication of the Offering Memorandum, Océ will convene an extraordinary general meeting of
shareholders to inform its shareholders about the Offer and to approve certain customary resolutions that are to
be adopted as a condition to the Offer;
The settlement date is to be determined.
Mizuho Securities acted as financial advisor to Canon.
Stibbe and Herbert Smith acted as legal advisors to Canon.
ING Corporate Finance acted as financial advisor to Océ and provided a fairness opinion.
Lazard acted as financial advisor to Océ Supervisory Board and provided a fairness opinion.
De Brauw Blackstone Westbroek acted as legal advisor to Océ.
Hill & Knowlton acted as communication advisor to Océ.