The largest shareholder of NaviSite has offered to buy the managed hosting provider, the company said today. Atlantic Investors LLC, which owns 36.6 percent of NaviSite shares, has offered to buy the remainder of the company's stock at a price of $3.05 a share. The offer values the company at $114.9 million.
The offering price represented an 11 percent premium to NaviSite's closing price Friday of $2.75 per share. After rising slightly in early trading Monday, shares of NaviSite (NAVI) declined to $2.73 near the closing bell, well below the value of the offer from Atlantic. The company's stock traded below 50 cents per share in early 2009, but rebounded in the second half of the year and traded as high as $3.13 in February.
NaviSite CEO Arthur Becker and chairman Andrew Ruhan each have business associations with Atlantic Investors. Becker is a managing member of Madison Technology LLC, which in turn is a managing member of Atlantic. Ruhan holds an equity interest in Unicorn Worldwide Holdings Limited, which is also a managing member of Atlantic.
NaviSite’s board of directors has formed a special committee of independent directors to consider the proposal, comprised of directors James Dennedy, Thomas Evans and Larry Schwartz. "The board of directors cautions NaviSite's stockholders and others considering trading in its securities that no decisions have been made by the board of directors with respect to NaviSite's response to the proposal," the board said in a statement.
Atlantic’s proposal is contingent upon obtaining the necessary financing to complete the deal.
NaviSite operates 15 Data Centers located across the US and UK, with about 230,000 square feet of usable customer space. The company operates facilities in Andover, Mass.; Chicago; Dallas; Houston; Las vegas; London; Charlotte, N.C.; Minneapolis, Minn.; New York City; Oak Brook, Ill.; San Francisco; San Jose, Calif.; Syracuse, N.Y. and Vienna, Va. in the U.S. and sites at London and Woking in the UK.