San Francisco, California and Newton, Mass—Macromedia, Inc. (NASDAQ: MACR) and Allaire Corporation (NASDAQ: ALLR) today announced a definitive merger agreement. The combined company will unite the Web design and development communities and enable Web professionals to efficiently build the look of a Web site and the application logic behind it—creating the best possible user experience across multiple devices.
The transaction, valued at approximately $360 million on a fully-diluted basis, brings together market-leading server, authoring and playback software to make Web development more efficient, affordable, and accessible. Under the terms of the definitive merger agreement unanimously approved by each company’s board of directors, Macromedia will acquire Allaire. Rob Burgess, chairman and CEO of Macromedia, will continue as chairman and CEO of the combined company, which will retain the Macromedia name. Jeremy Allaire, CTO of Allaire, will be the CTO of Macromedia, reporting to Kevin Lynch, president of Macromedia products.
"This merger is a natural. Combining the technology and talent of Macromedia and Allaire will bring Web professionals a complete, accessible way to build engaging, dynamic Web sites and applications," said Burgess. "With this merger, we are taking the next logical step in empowering developers to create—and users to enjoy—a new generation of compelling Web experiences on everything from personal computers and set-top boxes to PDAs and beyond."
"Allaire and Macromedia share a common vision, business model, and corporate culture," said David Orfao, president and CEO of Allaire. "This merger will bring together complementary products, extensive channels, and first-rate service organizations into a powerful combined company that will lead the Web software industry."
"Our combined user communities are at the forefront of defining today's Web experiences," said Lynch. "Together, we will lead the way in constructing the dynamic, multi-device Web of the future, and deliver this across industry standard application servers."
In the merger, Macromedia will exchange 0.2 shares of its stock and $3 in cash for each Allaire share. The merger will be accounted for as a purchase combination and is expected to be accretive in Macromedia’s fiscal year 2002. This transaction is subject to certain closing conditions, including regulatory approvals and the approval of the Allaire shareholders, and is expected to close by the second calendar quarter of 2001. In connection with the merger agreement, Allaire has granted Macromedia an option to acquire 19.9 percent of Allaire’s stock, exercisable in certain circumstances.
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