Vicon Industries, Inc. (VII: NYSE-MKT) (“Vicon”), and IQinVision, Inc. (“IQinVision”), a privately held California corporation, announced today that they have entered into a definitive merger agreement that is expected to create a global provider of integrated solutions to the video security market. Vicon is a designer and producer of video security and surveillance systems. IQinVision designs and produces high performance HD megapixel IP cameras.
The merger has been approved by the boards of directors of both companies and is subject to shareholder approval, and other customary closing conditions. The transaction is expected to close in Vicon’s September quarter. Under the terms of the merger agreement, Vicon will issue shares of Vicon common stock to IQinVision shareholders in an all-stock merger whereby IQinVision shareholders will own approximately 50 per cent of the outstanding common stock of the combined company. After the merger, Vicon will have approximately 9,000,000 shares outstanding.
As permitted and contemplated by the merger agreement, Vicon expects to declare a special cash dividend of $0.55 per share payable with respect to shares of Vicon common stock held by shareholders of Vicon as of a record date prior to the completion of the merger and payable to such holders within 15 days after the completion of the merger.
“Vicon is thrilled to join forces with IQinVision,” said Ken Darby, Vicon chairman and ceo. “Together, with the Vicon line of HD megapixel robotic dome cameras, our enterprise class video management software, ViconNet® and IQinVision’s highly regarded IQeye brand, we bring a compelling solution offering to the video security market. The IQinVision transaction is consistent with our strategy of providing high quality, proprietary solutions to our customers. The Vicon/IQinVision combination will yield meaningful operational benefits, together with significant market and technological synergies. It’s a logical first step to strategic growth for both companies,” said Darby.
“This is a great fit for IQinVision as we combine with one of the iconic brands in the industry. Our product offerings are complementary to Vicon’s solutions, and we believe Vicon’s worldwide sales organization will effectively promote the IQeye brand to new markets and accelerate the growth of our sales footprint,” said Charles Chestnutt, ceo of IQinVision.
Darby, who has delayed his retirement, will continue to lead the Company until his successor is named. The search for a new ceo was recently restarted.
Both Vicon and IQinVision’s product offerings will retain their existing branding, and both companies will continue to sell into and service their existing channels and customers. Customers will see no difference in sales, service, and support levels compared with prior to the merger.
For the twelve months ended December 31, 2013, IQinVision and Vicon combined generated $56 million in revenue. Following the merger, the board of directors of the combined company will consist of three directors designated by Vicon and three directors designated by IQinVision. TM Capital Corp. and Imperial Capital acted as financial advisors to Vicon and IQinVision, respectively.