![]() ARRIS TO ACQUIRE PACE PLC APRIL 22 nd 2015 Exhibit 99.2 |
![]() SPEAKING TODAY BOB STANZIONE ARRIS CHAIRMAN & CEO DAVID POTTS ARRIS EVP & CFO BRUCE MCCLELLAND ARRIS PRESIDENT – NETWORK, CLOUD & GLOBAL SERVICES LARRY ROBINSON ARRIS PRESIDENT – CPE 22 April 2015 2 MIKE PULLI PACE CEO Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() SAFE HARBOR 22 April 2015 3 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION. No Offer or Solicitation This document is provided for informational purposes only and does not constitute an offer to sell, or an invitation to subscribe for, purchase or exchange, any securities or the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issuance, exchange or transfer of the securities referred to in this document in any jurisdiction in contravention of applicable law. Forward Looking Statements This presentation contains forward looking statements. These statements include, among others, statements concerning projections of revenues, income and other financial items; plans for future performance of ARRIS following the completion of the Pace acquisition, ARRIS’ ability to drive the strategic benefits outlined; and the time frame during which the acquisition will close. Statements regarding future events are based on the parties’ current expectations. Actual results may differ materially from those contained in any forward-looking statement. Forward- looking statements are necessarily subject to associated risks related to, among other things, successful completion of the acquisition process including receipt of necessary regulatory approvals and the approval of Pace and ARRIS shareholders; the potential impact on ARRIS’ and Pace’s respective businesses due to uncertainty about the acquisition; the retention of employees of Pace; the ability of ARRIS to successfully integrate Pace’s opportunities, technology, personnel and operations; ARRIS’ inability to achieve expected synergies within the expected timeframes or at all; and changes in tax laws or interpretations that could increase ARRIS’ consolidated tax liabilities, including, if the transaction is consummated, changes in tax laws that would result in New ARRIS being treated as a domestic corporation for U.S. federal tax purposes. Other factors that could cause results to differ from current expectations include: the uncertain current economic climate and financial markets; and their impact on ARRIS’ customers’ plans and access to capital: the impact of rapidly changing technologies; the impact of competition including on product development; the ability of ARRIS to react to changes in general industry and market conditions; rights to intellectual property and the current trend toward increasing patent litigation, market trends and the adoption of industry standards; and consolidations within the broadband communications industry of both the customer and supplier base. These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect the Company’s business. Additional information regarding these and other factors can be found in ARRIS’ reports filed with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2014. In providing forward-looking statements, the Company expressly disclaims any obligation to update publicly or otherwise these statements, whether as a result of new information, future events or otherwise. |
![]() SAFE HARBOR Important Additional Information and Where You Can Find It It is expected that the shares of New ARRIS to be issued to Pace shareholders in the U.K. law scheme of arrangement transaction that forms a part of the transaction will be issued in reliance upon the exemption from the registration requirements of the Securities Act of 1933, as amended, provided by Section 3(a)(10) thereof. In connection with the issuance of New ARRIS shares to ARRIS shareholders pursuant to the merger that forms a part of the transaction, ARRIS will file with the SEC a registration statement on Form S-4 that will contain a prospectus of New ARRIS as well as a proxy statement of ARRIS relating to the merger that forms a part of the transaction, which we refer to together as the Form S-4/Proxy Statement. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE FORM S-4/PROXY STATEMENT, AND OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE TRANSACTION CAREFULLY AND IN THEIR ENTIRETY, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE TRANSACTION, THE PARTIES TO THE TRANSACTION AND THE RISKS ASSOCIATED WITH THE TRANSACTION. Those documents, if and when filed, as well as ARRIS’ and New ARRIS’ other public filings with the SEC may be obtained without charge at the SEC’s website at www.sec.gov, at ARRIS’ website at www.arris.com under “Investors.” Security holders and other interested parties will also be able to obtain, without charge, a copy of the Form S-4/Proxy Statement and other relevant documents (when available) by directing a request to ARRIS at 3871 Lakefield Drive, Suwanee, Georgia 30024, Attention: Investor Relations, (720) 895-7787 or by e-mail to bob.puccini@arris.com. Security holders may also read and copy any reports, statements and other information filed with the SEC at the SEC public reference room at 100 F Street N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at (800) 732-0330 or visit the SEC’s website for further information on its public reference room. 22 April 2015 4 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() SAFE HARBOR Participants in the Solicitation ARRIS, its directors and certain of its executive officers may be considered participants in the solicitation of proxies in connection with the transactions contemplated by the Proxy Statement. Information about the directors and executive officers of ARRIS is set forth in its Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on February 27, 2015 and its proxy statement for its 2015 annual meeting of stockholders, which was filed with the SEC on April 9, 2015. Other information regarding potential participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Proxy Statement/Prospectus when it is filed. Responsibility The directors of ARRIS accept responsibility for the information contained in this document and, to the best of their knowledge and belief (having taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and it does not omit anything likely to affect the import of such information. Pace acquisition-specific documents can be found at 22 April 2015 5 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. www.arris.com/pace |
![]() Combination enhances shareholder value • Significantly enhances ARRIS international presence • Provides large scale entry into satellite segment • Broader product portfolio in equipment, software and services • World-class technology and people • ~ $8B pro forma revenues • ~ 8,500 combined employees, globally based • Accretive transaction that maintains capital structure flexibility 22 April 2015 6 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() 1 2 3 4 ARRIS ANNOUNCES AGREEMENT TO ACQUIRE PACE PLC • Transaction equity value : ~$2.1B (~£1.4B) Stock and cash transaction • Diversifies customer base, product portfolio and global presence • Enhances scope and scale, ability to invest in innovative technologies and customer responsiveness Strong fit with ARRIS strategy • Expect Non-GAAP EPS accretion of $0.45 - $0.55 in first 12 months after closing • Maintains capital structure flexibility • Pro forma Non-GAAP tax rate of 26% to 28% The acquisition materially enhances shareholder value • Customary regulatory approvals • ARRIS and Pace shareholder approval Transaction is expected to close 2H 2015 22 April 2015 7 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() • ARRIS and Pace to each merge into subsidiaries of a new holding company (“New ARRIS”) • New ARRIS to be incorporated in the UK • Operational headquarters will remain in Suwanee, GA • No Change in ARRIS Board of Directors, CEO or CFO • New ARRIS shares expected to be listed on NASDAQ NEW ARRIS POST-CLOSING STRUCTURE 22 April 2015 8 ~76% ~24% COMBINED ASSETS OF: POST-CLOSING STRUCTURE NEW ARRIS (UK INCORPORATED) Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. SHAREHOLDERS SHAREHOLDERS |
![]() TRANSACTION OVERVIEW • Acquisition of Pace in cash and New ARRIS stock representing a Transaction Equity Value of $2.1B • ARRIS shareholders to receive one share of New ARRIS for each ARRIS share in a taxable transaction • Pace shareholders to receive per-share consideration valued at 426.5p as of 4/21/15, consisting of 132.5p in cash and 0.1455 shares of New ARRIS • ARRIS has secured committed funding for the transaction • New ARRIS ownership: 76% ARRIS shareholders / 24% Pace shareholders TRANSACTION TERMS • 28% premium to last closing share price • 24% premium to 3-month average share price IMPLIED PREMIUM • ARRIS and Pace each to merge into subsidiaries of a UK holding company (New ARRIS) • New ARRIS incorporated in the UK; New ARRIS expected to retain NASDAQ listing • New ARRIS to maintain operational headquarters in Suwanee, GA TRANSACTION STRUCTURE Transaction Enhances Shareholder Value 22 April 2015 9 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() ARRIS OVERVIEW (NASDAQ: ARRS) Global innovator in IP, video and broadband technology continually working with our customers to transform entertainment and communications to solve the most pressing challenges of 21st century communications FY2014 Revenue $5.3 Billion Over 1,000 Customers served, globally 2,000+ patents approved or pending 6,500 Employees. HQ in Suwanee, GA USA Direct and indirect presence in 84 countries $5.3B 1K 84 2K+ 6K+ 22 April 2015 10 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() ARRIS PORTFOLIO NETWORK & CLOUD CUSTOMER PREMISES EQUIPMENT IP or HFC Delivery Network 22 April 2015 11 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. CMTS / CCAP VIDEO INFRASTRUCTURE ACCESS & TRANSPORT CLOUD SERVICES GLOBAL SERVICES VIDEO GATEWAYS SET-TOP BOXES MODEMS CONNECTED TV CLIENTS MULTISCREEN |
![]() PACE OVERVIEW (LSE: PIC) A world leader in technologies, products and services for the Pay TV and broadband industries, Pace has an end-to-end range of products and services to simply and cost-effectively evolve digital services for subscribers 22 April 2015 12 $2.6B 200+ ~38% 2K 500+ FY2014 Revenue $2.6 Billion Over 200 Customers served, in 50 countries Non North America revenue 500+ patents approved or pending Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. ~2,000 Global Employees. HQ in Saltaire, UK |
![]() PACE PORTFOLIO 22 April 2015 13 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() BROADENS GLOBAL CUSTOMER BASE 22 April 2015 14 ENHANCED INTERNATIONAL PRESENCE SATELLITE CABLE TELCO SIGNIFICANT ADDRESSABLE MARKET Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() FINANCIAL HIGHLIGHTS David Potts, EVP, CFO |
![]() FINANCIALLY COMPELLING TRANSACTION 1 • ~$8 Billion Pro forma revenues 2 • $0.45 - $0.55 Accretive to Non–GAAP EPS, first 12 months after completion 4 • ~26% to 28% Pro forma Non-GAAP effective tax rate 5 • Target cash ~$650M • Pro forma leverage ratio of <2.5x Debt/LTM EBITDA Strong capital structure, post transaction 22 April 2015 16 3 • Product costs, operating expenses, public company costs • Proven track record of integrations Significant synergy opportunities Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() TRANSACTION FINANCING 22 April 2015 17 (1) Estimated as of 4/21/2015 (2) Assumes repayment of outstanding Pace debt with cash on hand at close Maintains significant capital structure flexibility • New Credit facility underwritten by Bank of America Merrill Lynch • Incremental commitment of ~$800M from Bank of America Merrill Lynch Sources Uses Cash $55 Cash Consideration (132.5p per Pace Share) $655 New ARRIS Debt 700 Value of New ARRIS Shares Issued to Pace (1) 1,455 Value of New ARRIS Shares Issued to Pace (1) 1,455 Transaction Equity Value $2,110 Fees + Expenses 100 Total Sources $2,210 Total Uses $2,210 Estimated Pro Forma Leverage Estimated Liquidity at Close Estimated Debt / LTM EBITDA Less than 2.5X Estimated Cash at Close $650 Plus: Revolver Capacity at Close 500 Available Liquidity $1,150 (2) Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |
![]() Combination enhances shareholder value • Significantly enhances ARRIS international presence • Provides large scale entry into satellite segment • Broader product portfolio in equipment, software and services • World-class technology and people • ~ $8B pro forma revenues • ~ 8,500 combined employees, globally based • Accretive transaction that maintains capital structure flexibility 22 April 2015 18 Copyright 2015 – ARRIS Enterprises, Inc. All rights reserved. |