NU Online News Service, Sept. 30, 3:29 p.m. EDT
LECG Corporation said it will merge with SMART Business Advisory & Consulting, LLC and receive a $25 million cash investment from SMART's majority shareholder, Great Hill Partners.
Under the agreement, LECG will issue about 10.9 million shares of common stock, valued at $39.9 million, to acquire all of SMART's outstanding shares.
LECG will issue approximately 6.3 million shares of a newly created Series A Convertible Redeemable Preferred Stock at a purchase price of $3.96 per share in exchange for a $25 million cash investment in the combined company. The company said it anticipates these transactions will be accretive in 2010.
Chris Tattersall, United Kingdom managing director, said in an e-mail that the transaction is subject to shareholder and Securities and Exchange Commission approval and is expected to be completed by Nov. 30.
"We will be executing a comprehensive integration plan between now and into the first quarter of the year, and these internal changes will not adversely impact our relationships…" he said, adding that the company is likely to transition to a new brand name over the next six months.
In combination with LECG's services in economics, finance and accounting, SMART brings top consultants and a number of Fortune 200 clients as well as approximately $100 million in revenues from highly complementary financial advisory and business consulting practices, the companies said.
SMART provides technology, business process improvement, compensation and benefits, accounting, actuarial, and tax advice.
The firm has a strong focus on the insurance, banking, real estate, health care, education and public sectors. In its verticals, SMART said it provides services to more than half of industry leaders. With virtually no overlap in services, LECG said the transaction will provide optimal synergies.
Steve Samek, chief executive officer of SMART since 2008, will become CEO of the combined company and a member of the board of directors upon completion of the merger, replacing Michael Jeffery. Mr. Jeffery announced in July that he would be stepping down as LECG's CEO.
Mr. Jeffery said, "I will be very pleased to pass the baton to Steve Samek, a highly accomplished innovator and leader in the global professional services market. I strongly believe he is the right person to take the company to the next level."
He added, "The combination of our companies significantly strengthens our competitive position and should allow LECG to capture greater share as demand returns to our industry."
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.