By Lisa Thompson
NYSE: PERF
READ THE FULL PERF RESEARCH REPORT
Today, Perfect Corp. (NYSE: PERF) received a preliminary non-binding letter that proposes a “going-private” transaction for $1.95 in cash per ordinary share from CyberLink International Technology Corp. and Alice H. Chang and her controlled entities. Alice Chang, the CEO, controls 66.6% of the voting power. Ms. Chang and CyberLink together own over 53% of the company’s Class A and B shares. According to our last valuation, we valued PERF stock at $3.10 per share based on an enterprise value-to-sales basis of 2.4 times, or half that of its peers. In the public markets, it has never received a proper valuation as investors ignored its large cash balance of $172 million or $1.69 per share when assessing a market cap.
According to the proposal, the consortium members will establish an acquisition vehicle to implement the transaction. The transaction is expected to be financed through equity contributions from the consortium members in the form of rollover equity in the company and available unrestricted cash from the company. Debt financing may also be arranged as necessary. A copy of the proposal is available on the SEC website.
The board intends to convene in the near future to review the proposal and to establish a special committee of independent and disinterested directors for the purpose of evaluating and considering the proposal. In connection with its review, the special committee, once formed, will be authorized to retain independent legal, financial, and other advisors to assist in its evaluation. The company does not undertake any obligation to provide any updates with respect to any transaction, except as required under applicable law.
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