Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. Borderfree, Inc. (1277141) 10-Q published on May 07, 2015 at 5:07 pm
Reporting Period: Mar 30, 2015
On May 5, 2015, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Pitney Bowes Inc., a Delaware corporation (“Parent”), and BrickBreaker Acquisition Corp., a Delaware corporation and a subsidiary of Parent (“Purchaser”), pursuant to which, among other things, Purchaser will commence a tender offer for all the outstanding shares of the Company’s common stock, par value $0.01 per share (the “Shares”), subject to the terms and conditions of the Merger Agreement. Following the consummation of the tender offer, and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Purchaser will be merged with and into the Company, with the Company continuing as the surviving corporation as a subsidiary of Parent.
Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, Purchaser will commence a cash tender offer to purchase all of the outstanding Shares, at a purchase price of $14.00 per Share, net to the seller thereof in cash, without interest and less any required withholding taxes.
Under the acquisition method of accounting, the Company allocated the purchase price to the identifiable assets and liabilities based on their estimated fair value, which was determined by management using the information available as of the date of the acquisition (Level 3 inputs). The Company believes this information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but certain items may be subject to change as additional information is received about facts and circumstances that existed at the date of acquisition. Thus, the preliminary measurements of fair value set forth below are subject to change. The Company is still conducting its review of the allocation of intangibles and expects to finalize the valuation as soon as practicable, but not later than one year from the acquisition date.
Methodologies used in valuing the intangible assets include, but are not limited to, the multiple period excess earnings method for customer relationships and the income method for technology. The excess of the purchase price over the total net identifiable assets has been recorded as goodwill which includes synergies expected from the expanded service capabilities and the value of the assembled work force in accordance with GAAP. The Company did not record any in-process research and development charges in connection with the acquisition.
On May 5, 2015, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Pitney Bowes Inc. (“Pitney”) and BrickBreaker Acquisition Corp. (“Purchaser”) that provides for a tender offer by Purchaser to purchase all of our outstanding shares at a purchase price of $14.00 per share, net to the seller thereof in cash, without interest and less any required withholding taxes. Following consummation of tender offer, and subject to the satisfaction or waiver of certain conditions in the Merger Agreement, Purchaser will be merged with and into Borderfree, with Borderfree continuing as the surviving corporation as a subsidiary of Pitney. Completion of the transaction is subject to certain customary closing conditions. Following completion of the transaction, our common stock will be delisted from the Nasdaq Stock Market and will no longer trade publicly. A description of the Merger Agreement is contained in our current report on Form 8-K filed with the SEC on May 6, 2015, and a copy of the Merger Agreement is filed as Exhibit 2.1 to such report.
The decrease in global ecommerce services revenue is primarily attributable to the decrease in GMV from $112.9 million for the three months ended March 31, 2014 to $100.0 million for the three months ended March 31, 2015, a decrease of 11.4%. This decrease in GMV was primarily a result of the impact from foreign currency movements relative to the U.S. dollar that negatively impacted consumer demand. Of the $12.9 million decrease in GMV, $14.4 million was attributable to lower volumes associated with customers operating on our platform during the same comparable period in the prior year, offset by an increase in GMV of $1.5 million attributable to new customers that were not on our platform during the same comparable period in the prior year, including new customers launched on our platform subsequent to the three months ended March 31, 2014. The decrease in fulfillment services revenue was due to a decline in volume primarily attributable to foreign currency movements relative to the U.S. dollar as described above. Fulfillment services revenue per order is expected to continue to decrease in subsequent periods as we optimize logistics and pass on our savings to the consumer to increase order conversion. Additionally, we had 173 ecommerce sites operating on our ecommerce platform as of March 31, 2015, an increase from 161 ecommerce sites as of March 31, 2014.