Business Context and Reporting Period
Company: TTM Technologies, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: November 16, 2009
Event: Entry into a Material Definitive Agreement (Stock Purchase Agreement) to acquire four wholly-owned subsidiaries of MTG Investment (BVI) Limited (the "PCB Subsidiaries"). The target entities engage in the manufacturing and distribution of printed circuit boards, including circuit design, quick-turn-around services, and drilling and routing services.
Key Financial Metrics and Transaction Terms
The filing details the consideration for the proposed acquisition rather than historical financial performance metrics (revenue, profit, cash flow) for the reporting period.
- Cash Consideration: $114,034,328
- Stock Consideration: 36,334,000 shares of TTM common stock (par value $0.001 per share)
- Debt Assumption: TTM will assume the outstanding debt of the PCB Subsidiaries (specific amount not disclosed in this filing).
- Ownership Impact: Following the acquisition and a proposed special dividend by Meadville Holdings Limited to its shareholders, Meadville's shareholders would own approximately 46% of TTM's outstanding common stock.
Material Changes and Transaction Structure
This filing represents a material change in TTM's capital structure and business operations pending shareholder and regulatory approval.
- Acquisition Structure: TTM will acquire 100% of the capital stock of the PCB Subsidiaries. The deal is not subject to adjustment based on stock price fluctuations prior to closing.
- Shareholder Agreement: Principal Shareholders of Meadville will enter into a shareholders agreement with TTM, including restrictions on increasing beneficial ownership above a predefined percentage, voting restrictions (including potential bifurcated voting), and an 18-month lock-up period on shares issued in the transaction.
- Board Representation: Principal Shareholders will be entitled to designate one individual for nomination as a TTM director, provided ownership thresholds are met. They will also nominate a majority of directors for the boards of the acquired PCB Subsidiaries.
Guidance, Risks, and Contingencies
Conditions Precedent: The transaction is subject to several closing conditions, including:
- Approval by TTM and Meadville shareholders at special meetings.
- Completion of the Committee on Foreign Investment in the United States (CFIUS) review.
- Obtaining all required regulatory consents and approvals.
- Absence of any material adverse effect on the parties.
Termination Rights: The agreement may be terminated if closing does not occur by May 31, 2010 (extendable to June 30, 2010 under certain conditions), if shareholder approvals are not obtained, or if laws preventing the transaction become permanent.
Regulatory Filings: TTM intends to file a Registration Statement on Form S-4 containing a proxy statement and U.S. prospectus. Investors are urged to read these documents before making voting or investment decisions.
Investor Verification Checklist
- Verify the specific amount of debt being assumed from the PCB Subsidiaries, as this figure is not explicitly stated in the 8-K summary.
- Monitor the upcoming special shareholder meetings for both TTM and Meadville to confirm approval of the transaction.
- Review the forthcoming Form S-4 filing for detailed financial statements of the target subsidiaries and the full text of the shareholders agreement.
- Track the status of the CFIUS review and other regulatory approvals required for closing.
- Assess the impact of the 46% ownership stake by Meadville's shareholders on TTM's future corporate governance and voting dynamics.