At least 3 others persued ExactTarget

For a bunch of computer nerds, ExactTarget certainly had a lot of suitors.

At least three other companies pursued the Indianapolis digital marketer amid its courtship with San Francisco-based Salesforce.com, which led to a $2.5 billion buyout announced June 4.

A U.S. Securities Exchange Commission filing Wednesday details a bidding war in which Salesforce had to up its offers to keep pace with other would-be buyers.

Records describe the suitors as “three other global software companies,” which are only identified as “Party A,” “Party B” and “Party C.”

Prior to the buyout announcement, analysts suspected Salesforce was leading a charge for ExactTarget. But corporations such as IBM, Adobe Systems and SAP were on the list.
http://www.ibj.com/exacttarget-lands-on-tech-shopping-list/PARAMS/article/40478

Discussions about a buyout go back as far as late 2012, when CEO Scott Dorsey and his leadership team began meeting periodically with the four companies.

Salesforce CEO Marc Benioff began meeting regularly with Dorsey and his officers on April 22.

Two days later, “Party A” told ExactTarget it had “a desire to move quickly” on a deal.

Another two days later, on April 26, Benioff proposed $26 a piece for ExactTarget’s 69.3 million shares. It would have been a $1.8 billion deal that would have paid a 37 percent premium for shares that closed at $19.01 that day.

Executives and advisers agreed that selling—to any of the four companies—was worth exploring, but a decision wouldn’t be made until weeks later.

Meetings and teleconferences continued with all the suitors into May. By May 9, ExactTarget’s leadership decide the company was worth more than $26 a share and agreed to get Salesforce to boost its offer.

ExactTarget continued meeting with the other companies as they awaited word from Salesforce. On May 22, “Party B” offered $30 a share, which would translate to almost $2.1 billion—$300 million more than Salesforce’s first offer.

Dorsey followed up two days later with phone calls to Salesforce and “Party B.” Benioff responded later that day by matching the other company’s offer.

After hearing that, ExactTarget and its financial advisers decided to see who would go higher.

“Party B” offered $30.50 a share but indicated it was willing to go as high as $32.

It turned out to matter little because Benioff called a few hours later and offered to pay $33.75 per share.

Salesforce sealed the deal with ExactTarget on June 3. Based on the stock’s $22.10 closing price that day, investors netted a 53 percent premium.

Technology sector observers expect the approximately $2.5 billion deal resulting from the bidding war to generate a splash effect in startups and angel investing. Employee benefits that provide stock options to all ExactTarget staff, regardless of rank, should be a $300 million gain for the 1,700 people workers.
http://www.ibj.com/exacttarget-option-gains-approach-300m/PARAMS/article/41812

The top three executives, meanwhile, will land with a $17 million golden parachute, on top of any additional shares they own, according to Wednesday’s SEC filing.

Dorsey accounts for more than half the parachute, taking home almost $9.4 million as part of deals from his employment agreement.

Most of Dorsey’s parachute, $8.5 million, will come through accelerating shares of his unvested stock options and restricted stock he was entitled to as CEO.

Dorsey, who plans to join Salesforce CEO Marc Benioff’s senior management team, also receives a $838,500 cash severance, a payment that equal 150 percent of his base salary plus 50 percent of his annual bonus. He also receives $24.8 million in perks related to his COBRA benefits.

Chief Financial Officer Steve Collins gets a $3.7 million parachute, and Scott McCorkle, president of technology of strategy, gets $4 million, records state.