VTech Holdings Limited and LeapFrog Enterprises, Inc., announced this morning that the two companies have entered into a merger agreement whereby VTech will acquire LeapFrog.
VTech plans to acquire 100 percent of the outstanding common stock of LeapFrog through an all cash tender offer followed by a second-step merger. In the tender offer, VTech will offer LeapFrog investors $1.00 per share for LeapFrog’s Class A and Class B shares, which represents a 75.4 percent premium over the closing price of LeapFrog’s Class A shares on February 4, 2016. The total purchase consideration amounts to approximately $72 million. The deal is expected to close on March 3, 2016.
“We are delighted to have the LeapFrog brand joining VTech, bringing together two of the great names in children’s learning and entertainment,” said Allan Wong, chairman and group CEO of VTech Holdings Limited, in this morning’s statement. “VTech has been a pioneer in the electronic learning toy category for 35 years. The acquisition will allow us to offer the broadest portfolio of products that enhances the education and development of children across the world, while bringing them fun and joy.”
Bill Chiasson, chairman of LeapFrog’s board of directors, said in this morning’s statement. “We believe this is a terrific opportunity for our employees, customers, and shareholders. The acquisition and future investment by VTech will be instrumental to helping the LeapFrog brand achieve the mission of helping each child achieve their potential. Importantly, too, this transaction also rewards our shareholders with a significant premium from recent trading levels.”