Exhibit (c)(1) *
P R E S E N T A T I O N T O T H E S P E C I A L C O M M I T T E E O F S I G H T ’ S B O A R D O F D I R E C T O R S
S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L
O C T O B E R 1 4 , 2 0 1 0
Project Sight
* Certain slides not materially related to the Rule 13e-3 transaction have been removed
CONFIDENTIAL
THE FOLLOWING PAGES CONTAIN MATERIAL PROVIDED TO THE BOARD OF DIRECTORS OF SIGHT (“SIGHT” OR THE “COMPANY”) BY OPPENHEIMER & CO. INC. (“OPPENHEIMER”) ON A CONFIDENTIAL BASIS IN CONNECTION WITH THE PROPOSED TRANSACTION INVOLVING SIGHT AND ERIC INTERNATIONAL (“ERIC”). THE ACCOMPANYING MATERIAL WAS NOT COMPILED OR PREPARED WITH A VIEW TOWARD PUBLIC DISCLOSURE UNDER STATE OR FEDERAL SECURITIES LAWS OR OTHERWISE AND MAY NOT BE USED FOR ANY OTHER PURPOSE OR RELIED UPON BY ANY THIRD PARTY. THE INFORMATION CONTAINED IN THIS MATERIAL WAS OBTAINED FROM THE COMPANY AND PUBLIC SOURCES AND WAS RELIED UPON BY OPPENHEIMER WITHOUT (AND WITHOUT ASSUMING RESPONSIBILITY FOR) INDEPENDENT VERIFICATION AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. ANY ESTIMATES AND PROJECTIONS FOR THE COMPANY CONTAINED HEREIN HAVE BEEN SUPPLIED BY THE MANAGEMENT OF THE COMPANY, AND INVOLVE NUMEROUS AND SIGNIFICANT SUBJECTIVE DETERMINATIONS. THERE IS NO ASSURANCE THAT SUCH ESTIMATES AND JUDGMENTS WILL BE REALIZED. NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS MADE BY OPPENHEIMER AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION AND NOTHING CONTAINED HEREIN IS, OR SHALL BE RELIED UPON AS, A REPRESENTATION OR WARRANTY, WHETHER AS TO THE PAST, THE PRESENT OR THE FUTURE. THIS MATERIAL WAS NOT PREPARED FOR USE BY READERS NOT AS FAMILIAR WITH THE BUSINESS AND AFFAIRS OF THE COMPANY AS THE BOARD OF DIRECTORS OF THE COMPANY AND, ACCORDINGLY, NEITHER THE COMPANY NOR OPPENHEIMER NOR THEIR RESPECTIVE LEGAL OR FINANCIAL ADVISORS OR ACCOUNTANTS TAKE ANY RESPONSIBILITY FOR THE ACCOMPANYING MATERIAL IF USED BY PERSONS OTHER THAN THE BOARD OF DIRECTORS OF THE COMPANY. OPPENHEIMER ASSUMES NO OBLIGATION TO UPDATE OR OTHERWISE REVISE THE ACCOMPANYING MATERIAL.
THE ACCOMPANYING MATERIAL DOES NOT CONSTITUTE LEGAL OR REGULATORY ADVICE AND OPPENHEIMER DOES NOT HOLD ITSELF OUT TO BE AN ADVISOR AS TO SUCH MATTERS.
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
| 1 | Transaction Overview | ||
| 2 | Financial Analysis | ||
| A | Sight Management Projections | ||
| B | Valuation Summary | ||
| C | Selected Public Companies Analysis | ||
| D | Selected Transactions Analysis | ||
| E | Discounted Cash Flow Analysis | ||
| F | Premiums Paid Analysis | ||
| 3 | Appendix I | ||
| 4 | Appendix II | ||
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
Confidential
Table of Contents
| 1 | Transaction Overview |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
1
Transaction Overview
Source: Company filings, Sight Management and FactSet.
| 1. | Represents stock price trading range for 52 weeks ending 06/15/10 (day prior to Israeli press speculation). |
| 2. | Cash balance adjusted to reflect $13.5mm dividend (~$0.804 per share, declared Oct. 13, 2010 and to be paid on or about Nov. 24, 2010 to shareholders if record as of Nov. 8, 2010). |
| 3. | Investment in affiliates includes investments in Optispeed Laboratory, Emerald and e-Vision. Minority interest reflects interests in Spherical Optics, Centro Integral Optico S.A. de C.V., Shalens S.A. de C.V., Sight Lens and Sight Australia. |
| Stock Price | Merger | ||||||||||
| 10/13/10 | Consideration | ||||||||||
| Per Share Consideration | $ | 11.78 | $ | 14.50 | |||||||
| Premium to: | |||||||||||
| Current | – | 23.1 | % | ||||||||
| 52-wk High | $ | 11.79 | – | 23.0 | % | ||||||
52-wk High - Unaffected (1) | 10.74 | – | 35.0 | % | |||||||
| 1-Month Average Price | 10.78 | – | 34.5 | % | |||||||
| 3-Month Average Price | 9.70 | – | 49.5 | % | |||||||
| 1-Year Average Price | 9.02 | – | 60.8 | % | |||||||
| Primary Common Shares Outstanding | 16.781 | 16.781 | |||||||||
| In-The-Money Options | 1.395 | 1.466 | |||||||||
| Gross Diluted Shares | 18.176 | 18.247 | |||||||||
| Gross Equity Value | $ | 214.1 | $ | 264.6 | |||||||
| Less: Options Proceeds | (12.0 | ) | (12.9 | ) | |||||||
| Implied Net Value of Equity | $ | 202.1 | $ | 251.7 | |||||||
Less: Cash @ 09/30/10 (2) | (23.6 | ) | (23.6 | ) | |||||||
| Plus: Debt @ 09/30/10 | 24.6 | 24.6 | |||||||||
Plus: Minority Interest @ 09/30/10 (3) | 3.7 | 3.7 | |||||||||
Less: Investment in Affiliates @ 09/30/10 (3) | (1.3 | ) | (1.3 | ) | |||||||
| Implied Sight Enterprise Value | $ | 205.6 | $ | 255.1 | |||||||
| Financial | |||||||||||
| Statistic | Enterprise Value Multiples | ||||||||||
| Revenue | |||||||||||
| LTM (6/30/10) | $ | 154.3 | 1.33 | x | 1.65 | x | |||||
| 2010E | 166.3 | 1.24 | 1.53 | ||||||||
| 2011E | 180.3 | 1.14 | 1.42 | ||||||||
| EBITDA | |||||||||||
| LTM (6/30/10) | $ | 31.1 | 6.6 | x | 8.2 | x | |||||
| 2010E | 33.0 | 6.2 | 7.7 | ||||||||
| 2011E | 36.0 | 5.7 | 7.1 | ||||||||
Implied Transaction Statistics
(in millions, except per share data)
(in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
5
Transaction Overview
Note: | Optical peers include Hoya Corp., Carl Zeiss Meditec AG, Essilor International, Safilo Group SpA, Marcolin SpA. and Staar Surgical Co. Small Cap Medical peers include ICU Medical Inc., Syneron Medical Ltd., Consert Medical Plc, Exactech Inc., RTI Biologics Inc., and Solta Medical Inc. |
Source: Factset, press releases.
Sight Declares a Cash Dividend $4.0 Million or $0.24 per Ordinary Share
Sight Declares a Cash Dividend of $13.5 Million or $0.80 per Ordinary Share
Israeli Press Reported on Speculation of Acquisition Talk
Amos Netzer Appointed CEO
Sight Declares Cash Dividend of $10 Million or $0.61 per Ordinary Share
Received Term Sheet From Eric
Small Cap Medical
Sight
Optical
Sight Stock Price Performance: Last 3 Years (NASDAQ)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
6
Transaction Overview
% of Shares Traded - NASDAQ & TASE
Source: Factset.
Note: | Stock prices translated at daily NIS / US$ exchange rates. |
| (1) | Represents one day prior to article in Israeli press that speculated that Sight was in acquisition talks. |
Average Daily Volume:
NASDAQ: 23,802
TASE: 7,388
NASDAQ: 23,802
TASE: 7,388
Average Daily Volume:
NASDAQ: 12,323
TASE: 8,404
NASDAQ: 12,323
TASE: 8,404
Average Daily Volume:
NASDAQ: 21,637
TASE: 7,955
NASDAQ: 21,637
TASE: 7,955
3 Month
6 Month
Average Daily Volume:
NASDAQ: 17,953
TASE: 8,589
NASDAQ: 17,953
TASE: 8,589
17.7%
0.0%
LTM to 6/15/2010(1)
12 Month
35.5%
57.6%
52.6%
11.9%
21.3%
9.23%
$11.00 - $12.00
10.5%
Volume (%) TASE
16.5%
31.2%
21.3%
20.6%
33.5%
10.6%
32.4%
28.3%
6.4%
9.9%
5.20%
Volume (%) TASE
Volume (%) NASDAQ
$11.00 - $12.00
$10.00 - $11.00
$9.00 - $10.00
$8.00 - $9.00
Less than
$8.00
$8.00
Volume (%) TASE
Volume (%) NASDAQ
$11.00 - $12.00
$10.00 - $11.00
$9.00 - $10.00
$8.00 - $9.00
Less than
$8.00
$8.00
7.8%
7.3%
7.7%
28.9%
44.5%
33.9%
33.4%
30.4%
32.5%
26.6%
13.2%
22.4%
3.2%
4.5%
3.6%
27.4%
36.6%
31.1%
30.5%
36.8%
33.0%
32.3%
20.9%
27.7%
9.8%
5.8%
8.2%
0.0%
Less than
$8.00
$8.00
$8.00 - $9.00
$9.00 - $10.00
$10.00 - $11.00
$11.00 - $12.00
Volume (%) NASDAQ
Volume (%) TASE
40.0%
23.0%
$10.00 - $11.00
Volume (%) NASDAQ
10.6%
16.1%
17.7%
19.7%
$8.00 - $9.00
17.2%
$9.00 - $10.00
23.5%
Less than
$8.00
$8.00
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
7
| 2 | Financial Analysis |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
8
| A | Sight Management Projections |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
9
Sight Management Projections
| Historical | LTM | Projected | ‘07 - ‘09 | ‘10 - ‘14 | ||||||||||||||||||||||||||||||||||||||
| 2007 | 2008 | 2009 | 6/30/2010 | 2010 | 2011 | 2012 | 2013 | 2014 | CAGR | CAGR | ||||||||||||||||||||||||||||||||
| Revenue | $ | 120.4 | $ | 140.3 | $ | 142.4 | $ | 154.3 | $ | 166.3 | $ | 180.3 | $ | 196.1 | $ | 213.3 | $ | 231.4 | 8.7 | % | 8.6 | % | ||||||||||||||||||||
| % growth | 23.8 | % | 16.5 | % | 1.5 | % | – | 16.8 | % | 8.4 | % | 8.8 | % | 8.7 | % | 8.5 | % | |||||||||||||||||||||||||
| Cost of Revenue | 55.9 | 64.4 | 65.4 | 69.5 | 77.9 | 83.8 | 89.4 | 94.7 | 100.0 | 8.2 | % | 6.4 | % | |||||||||||||||||||||||||||||
| Gross Profit | $ | 64.6 | $ | 75.9 | $ | 76.9 | $ | 84.8 | $ | 88.4 | $ | 96.5 | $ | 106.7 | $ | 118.5 | $ | 131.4 | 9.2 | % | 10.4 | % | ||||||||||||||||||||
| Sales & Marketing | $ | 36.6 | $ | 42.4 | 41.0 | 42.8 | 44.9 | 49.2 | 53.0 | 57.1 | 61.5 | 5.9 | % | 8.2 | % | |||||||||||||||||||||||||||
| R&D | 2.6 | 3.4 | 3.2 | 3.9 | 4.7 | 5.4 | 6.2 | 7.1 | 8.1 | 12.4 | % | 14.8 | % | |||||||||||||||||||||||||||||
| G&A | 13.5 | 16.8 | 15.4 | 16.8 | 14.3 | 15.3 | 16.5 | 17.7 | 19.0 | 6.6 | % | 7.3 | % | |||||||||||||||||||||||||||||
| Total Operating Expenses | $ | 52.7 | $ | 62.5 | $ | 59.6 | $ | 63.5 | $ | 63.9 | $ | 69.8 | $ | 75.7 | $ | 81.9 | $ | 88.5 | 6.4 | % | 8.5 | % | ||||||||||||||||||||
| EBIT | $ | 11.9 | $ | 13.4 | $ | 17.3 | $ | 21.3 | $ | 24.5 | $ | 26.7 | $ | 31.1 | $ | 36.6 | $ | 42.9 | 20.7 | % | 15.0 | % | ||||||||||||||||||||
| Depreciation & Amortization | 7.2 | 9.8 | 9.1 | 9.8 | 8.5 | 9.3 | 9.8 | 9.8 | 9.5 | 1.8 | % | 2.9 | % | |||||||||||||||||||||||||||||
| EBITDA | $ | 19.1 | $ | 23.2 | $ | 26.5 | $ | 31.1 | $ | 33.0 | $ | 36.0 | $ | 40.9 | $ | 46.4 | $ | 52.4 | 17.8 | % | 12.3 | % | ||||||||||||||||||||
| % growth | 21.5 | % | 14.2 | % | 17.6 | % | 24.7 | % | 9.0 | % | 13.7 | % | 13.5 | % | 12.9 | % | ||||||||||||||||||||||||||
| Margins | ||||||||||||||||||||||||||||||||||||||||||
| Gross Margin % | 53.6 | % | 54.1 | % | 54.0 | % | 54.9 | % | 53.1 | % | 53.5 | % | 54.4 | % | 55.6 | % | 56.8 | % | ||||||||||||||||||||||||
| Sales & Marketing % of Sales | 30.4 | % | 30.2 | % | 28.8 | % | 27.7 | % | 27.0 | % | 27.3 | % | 27.0 | % | 26.8 | % | 26.6 | % | ||||||||||||||||||||||||
| R&D % of Sales | 2.1 | % | 2.4 | % | 2.3 | % | 2.5 | % | 2.8 | % | 3.0 | % | 3.1 | % | 3.3 | % | 3.5 | % | ||||||||||||||||||||||||
| G&A % of Sales | 11.3 | % | 12.0 | % | 10.8 | % | 10.9 | % | 8.6 | % | 8.5 | % | 8.4 | % | 8.3 | % | 8.2 | % | ||||||||||||||||||||||||
| EBIT Margin | 9.9 | % | 9.5 | % | 12.2 | % | 13.8 | % | 14.7 | % | 14.8 | % | 15.8 | % | 17.2 | % | 18.5 | % | ||||||||||||||||||||||||
| EBITDA Margin | 15.8 | % | 16.5 | % | 18.6 | % | 20.2 | % | 19.8 | % | 20.0 | % | 20.8 | % | 21.8 | % | 22.6 | % | ||||||||||||||||||||||||
P&L: Sight Management Forecasts
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
10
| B | Valuation Summary |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
11
Valuation Summary
Financial Analysis Summary
($ in millions)
($ in millions)
| 1. | For illustrative purposes only. |
| 2. | Represents stock price trading range of $4.52 to $10.74 for the 52 week period ending 06/15/10 (day prior to Israeli press speculation). Dotted box represents stock price trading range of $6.85 to $11.79 for 52 weeks ending 10/13/10. |
Equity Value Per Share Reference Ranges
Selected Transactions Analysis
$11.69
$14.43
$14.19
$11.40
Memo: Unaffected
52-Week Trading Range (1) (2)
52-Week Trading Range (1) (2)
Memo: Premiums Paid Analysis (1)
$4.52
$10.74
Stock Price: $11.78 (10/13/10)
Price Before Press Speculation: $8.78 (6/15/10)
Per Share Merger Consideration: $14.50
$6.85
$11.98
$11.79
$15.97
$15.51
$11.89
DCF Analysis
Selected Public Companies Analysis
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
12
Valuation Summary
| Selected Public Companies Analysis | ||||||||||||||||||||||||||||||||||
| Financial | Multiple Range(1) | Enterprise Value | Equity Value | Per Share Amount | ||||||||||||||||||||||||||||||
| Statistic | Low | High | Low | High | Low | High | Low | High | ||||||||||||||||||||||||||
| LTM Revenue | $ | 154.3 | 1.13 | x | 1.38 | x | $ | 174.5 | $ | 213.3 | $ | 171.0 | $ | 209.8 | $ | 10.05 | $ | 12.20 | ||||||||||||||||
| 2010E Revenue | 166.3 | 1.12 | 1.37 | 186.5 | 227.9 | 183.0 | 224.5 | 10.72 | 13.01 | |||||||||||||||||||||||||
| 2011E Revenue | 180.3 | 1.06 | 1.30 | 191.8 | 234.4 | 188.3 | 231.0 | 11.01 | 13.37 | |||||||||||||||||||||||||
| LTM EBITDA | $ | 31.1 | 7.4 | x | 9.1 | x | $ | 231.8 | $ | 283.3 | $ | 228.3 | $ | 279.8 | $ | 13.22 | $ | 16.04 | ||||||||||||||||
| 2010E EBITDA | 33.0 | 7.1 | 8.7 | 234.8 | 287.0 | 231.3 | 283.5 | 13.39 | 16.25 | |||||||||||||||||||||||||
| 2011E EBITDA | 36.0 | 5.7 | 7.0 | 205.1 | 250.7 | 201.6 | 247.2 | 11.75 | 14.26 | |||||||||||||||||||||||||
| Average Reference Range | $ | 11.69 | $ | 14.19 | ||||||||||||||||||||||||||||||
| Selected Transactions | ||||||||||||||||||||||||||||||||||
| Financial | Multiple Range(1) | Enterprise Value | Equity Value | Per Share Amount | ||||||||||||||||||||||||||||||
| Statistic | Low | High | Low | High | Low | High | Low | High | ||||||||||||||||||||||||||
| LTM Revenue (06/30/10) | $ | 154.3 | 1.20 | x | 1.47 | x | $ | 185.5 | $ | 226.8 | $ | 182.1 | $ | 223.3 | $ | 10.66 | $ | 12.95 | ||||||||||||||||
| LTM EBITDA (06/30/10) | 31.1 | 7.4 | 9.0 | 229.9 | 281.0 | 226.4 | 277.5 | 13.12 | 15.92 | |||||||||||||||||||||||||
| Average Reference Range | $ | 11.89 | $ | 14.43 | ||||||||||||||||||||||||||||||
| DCF Analysis | ||||||||||||||||||||||||||||||||||
| Discount Rate | Perpetuity Growth | Equity Value | Per Share Amount | |||||||||||||||||||||||||||||||
| Low | High | Low | High | Low | High | Low | High | |||||||||||||||||||||||||||
| 13.0 | % | 15.0 | % | 2.5 | % | 4.5 | % | $ | 195.3 | $ | 278.6 | $ | 11.40 | $ | 15.97 | |||||||||||||||||||
| Average Reference Range | $ | 11.40 | $ | 15.97 | ||||||||||||||||||||||||||||||
| 1. | Multiple range represents +/- 10% range of median multiples. |
Financial Analysis Summary Detail
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
13
| C | Selected Public Companies Analysis |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
14
Selected Public Companies Analysis
| Price | % Of 52 Wk | Mkt. Val. | Enterprise | EV / Revenue | EV / EBITDA | |||||||||||||||||||||||||
| Company | 10/13/10 | High | Equity | Value | LTM | 2010E | 2011E | LTM | 2010E | 2011E | ||||||||||||||||||||
| Optical Comps | ||||||||||||||||||||||||||||||
| Essilor International | $ | 66.90 | 93.6 | % | $ | 14,080.3 | $ | 14,965.1 | 3.14 | x | 2.80 | x | 2.57 | x | 13.9 | x | 13.1 | x | 11.6 | x | ||||||||||
| Hoya | 24.41 | 75.9 | % | 10,529.1 | 9,657.9 | 1.91 | 1.86 | 1.77 | 7.4 | 7.0 | 6.6 | |||||||||||||||||||
| Carl Zeiss Meditec | 16.91 | 91.8 | % | 1,374.8 | 1,179.5 | 1.36 | 1.25 | 1.18 | 8.9 | 8.4 | 7.8 | |||||||||||||||||||
| Safilo Group | 14.91 | 69.7 | % | 620.1 | 995.3 | 0.73 | 0.68 | 0.64 | 9.7 | 7.9 | 6.3 | |||||||||||||||||||
| Marcolin | 4.14 | 95.5 | % | 254.2 | 193.2 | 0.80 | NA | NA | 6.9 | NA | NA | |||||||||||||||||||
| Staar Surgical | 5.65 | 83.8 | % | 199.6 | 195.1 | 2.52 | 3.36 | 3.18 | NM | NM | NM | |||||||||||||||||||
| Median | $ | 15.91 | $ | 997.5 | $ | 1,087.4 | 1.63 | x | 1.86 | x | 1.77 | x | 8.9 | x | 8.1 | x | 7.2 | x | ||||||||||||
| Mean | 22.15 | 4,509.7 | 4,531.0 | 1.74 | 1.99 | 1.87 | 9.4 | 9.1 | 8.1 | |||||||||||||||||||||
| Small Cap Medical Comps | ||||||||||||||||||||||||||||||
| ICU Medical | $ | 37.42 | 95.9 | % | $ | 526.4 | $ | 444.1 | 1.73 | x | 1.63 | x | 1.53 | x | 8.3 | x | 7.9 | x | 7.3 | x | ||||||||||
| Syneron Medical | 10.16 | 81.7 | % | 349.9 | 150.0 | 0.84 | 0.80 | 0.73 | NM | NM | NM | |||||||||||||||||||
| Consort Medical | 7.12 | 98.1 | % | 206.6 | 259.4 | 2.07 | 1.29 | 1.24 | 5.8 | 6.0 | 5.7 | |||||||||||||||||||
| Exactech | 14.96 | 67.0 | % | 193.4 | 216.8 | 1.16 | 1.12 | 1.03 | 7.8 | 6.8 | 5.9 | |||||||||||||||||||
| RTI Biologics | 2.70 | 58.8 | % | 148.0 | 142.3 | 0.87 | 0.86 | 0.80 | 9.6 | 8.5 | 4.9 | |||||||||||||||||||
| Solta Medical | 2.14 | 69.7 | % | 131.1 | 104.4 | 1.02 | 0.91 | 0.82 | NM | 8.6 | 4.7 | |||||||||||||||||||
| Median | $ | 8.64 | $ | 200.0 | $ | 183.4 | 1.09 | x | 1.02 | x | 0.92 | x | 8.0 | x | 7.9 | x | 5.7 | x | ||||||||||||
| Mean | 12.42 | 259.2 | 219.5 | 1.28 | 1.10 | 1.02 | 7.9 | 7.6 | 5.7 | |||||||||||||||||||||
| Overall Median | $ | 12.53 | $ | 302.0 | $ | 238.1 | 1.26 | x | 1.25 | x | 1.18 | x | 8.3 | x | 7.9 | x | 6.3 | x | ||||||||||||
| Overall Mean | 17.28 | 2,384.4 | 2,375.3 | 1.51 | 1.51 | 1.41 | 8.7 | 8.2 | 6.8 | |||||||||||||||||||||
| Sight | $ | 11.78 | 99.9 | % | $ | 202.1 | $ | 205.6 | 1.33 | x | 1.24 | x | 1.14 | x | 6.6 | x | 6.2 | x | 5.7 | x | ||||||||||
| Sight @ Deal | 14.50 | 123.0 | % | 251.7 | 255.1 | 1.65 | 1.53 | 1.42 | 8.2 | 7.7 | 7.1 | |||||||||||||||||||
| Source: Capital IQ, company filings and Wall Street consensus estimates. |
Selected Public Companies Analysis
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
15
| D | Selected Transactions Analysis |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
16
Selected Transactions Analysis
| Optical | ||||||||||||||||
| Transaction | Transaction Value / | |||||||||||||||
| Announced | Closed | Target | Acquiror | Value | LTM Revenue | LTM EBITDA | ||||||||||
| 06-15-08 | 10-13-08 | Satisloh Holding AG | Essilor International | $ | 521.7 | 1.34 | x | 7.5 | x | |||||||
| 12-17-04 | 02-01-05 | Ioltech | Carl Zeiss Meditec AG | 35.0 | 1.89 | 9.8 | ||||||||||
| 12-05-04 | 03-22-05 | Sola International | Carl Zeiss / EQT Partners | 1,199.4 | 1.37 | 9.4 | ||||||||||
| 01-15-02 | 02-28-02 | Biocompatibles International | Cooper Companies | 98.2 | 1.36 | NM | ||||||||||
| 05-30-00 | 10-03-00 | Wesley-Jessen Visioncare | Novartis AG | 839.8 | 2.59 | 11.9 | ||||||||||
| 03-09-00 | 06-15-00 | Hydron Limited | Biocompatibles | 63.0 | 1.34 | 12.4 | ||||||||||
| Median | $ | 158.3 | 1.36 | x | 9.8 | x | ||||||||||
| Mean | 416.5 | 1.55 | 10.2 | |||||||||||||
| Small Cap Medical | ||||||||||||||||
| Transaction | Transaction Value / | |||||||||||||||
| Announced | Closed | Target | Acquiror | Value | LTM Revenue | LTM EBITDA | ||||||||||
| 10-06-10 | Pending | Otix Global | William Demant Holding | $ | 55.2 | 0.62 | x | NM | ||||||||
| 04-05-10 | 07-29-10 | National Dentex Corporation | GeoDigm Corporation | 127.5 | 0.80 | 7.3 | x | |||||||||
| 07-01-06 | 07-01-06 | Ultravox Holdings Ltd. | Amplifon SpA | 116.4 | 1.11 | NA | ||||||||||
| 04-20-06 | 06-16-06 | Miltex Inc | Integra LifeSciences | 101.0 | 1.63 | 7.8 | ||||||||||
| 11-14-05 | 02-24-06 | Compex Technologies, Inc. | Encore Medical Corporation | 124.7 | 1.17 | 13.3 | ||||||||||
| 03-29-04 | 05-28-04 | KaVo Dental GmbH & Co KG | Danaher Corp | 425.0 | 0.94 | NA | ||||||||||
| 11-10-03 | 11-10-03 | Sirona Dental Systems | Permira | 480.4 | 1.47 | 6.8 | ||||||||||
| 03-28-02 | 03-28-02 | Smith & Nephew (Rehab Business) | One Equity Partners | 123.1 | 1.15 | 8.2 | ||||||||||
| 05-27-99 | 08-31-99 | Empi Inc. | The Carlyle Group | 168.5 | 2.27 | 7.6 | ||||||||||
| Median | $ | 124.7 | 1.15 | x | 7.7 | x | ||||||||||
| Mean | 191.3 | 1.24 | 8.5 | |||||||||||||
| Overall Median | $ | 127.5 | 1.34 | x | 8.2 | x | ||||||||||
| Overall Mean | 299.3 | 1.42 | 9.3 | |||||||||||||
| Sight @ Deal ($14.50 per share) | Eric International | $ | 255.1 | 1.65 | x | 8.2 | x | |||||||||
| Source: Dealogic, company filings. |
Selected Transactions Analysis
($ in millions)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
17
| E | Discounted Cash Flow Analysis |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Discounted Cash Flow Analysis
Terminal Value
Enterprise Value
| Projected | ||||||||||||||||||||
| 2H 2010 | 2011 | 2012 | 2013 | 2014 | ||||||||||||||||
| Fiscal Year End 12/31 | ||||||||||||||||||||
Revenue | $ | 85.2 | $ | 180.3 | $ | 196.1 | $ | 213.3 | $ | 231.4 | ||||||||||
| EBITDA | 15.8 | 36.0 | 40.9 | 46.4 | 52.4 | |||||||||||||||
Less: D&A | (4.2 | ) | (9.3 | ) | (9.8 | ) | (9.8 | ) | (9.5 | ) | ||||||||||
EBIT | $ | 11.6 | $ | 26.7 | $ | 31.1 | $ | 36.6 | $ | 42.9 | ||||||||||
Less: Allocation to Minorities | (0.5 | ) | (1.0 | ) | (1.1 | ) | (1.2 | ) | (1.3 | ) | ||||||||||
EBIT After Allocation to Minorities | $ | 11.1 | $ | 25.7 | $ | 30.0 | $ | 35.4 | $ | 41.6 | ||||||||||
Effective Tax Rate(1) | 23.9 | % | 23.5 | % | 22.0 | % | 20.8 | % | 20.2 | % | ||||||||||
Less: Income Taxes | (2.6 | ) | (6.0 | ) | (6.6 | ) | (7.4 | ) | (8.4 | ) | ||||||||||
| Unlevered After-Tax Income | $ | 8.4 | $ | 19.6 | $ | 23.4 | $ | 28.0 | $ | 33.2 | ||||||||||
| Plus: D&A | 4.2 | 9.3 | 9.8 | 9.8 | 9.5 | |||||||||||||||
Less: Capital Expenditures(1) | (4.4 | ) | (10.4 | ) | (11.1 | ) | (11.4 | ) | (11.0 | ) | ||||||||||
Less: Working Capital Investment(1) | (2.5 | ) | (1.7 | ) | (1.9 | ) | (1.9 | ) | (1.9 | ) | ||||||||||
| Free Cash Flow | 5.7 | 16.9 | 20.2 | 24.6 | 29.8 | |||||||||||||||
| 2014 Free Cash Flow | $ | 29.8 | ||
| Terminal Value @ 3.5% Growth | 292.9 | |||
| Present Value of Terminal value | $ | 162.3 |
| PV of Cash Flows @ 14.0% | $ | 70.0 | 30 | % | ||||
| PV of Terminal Value | 162.3 | 70 | % | |||||
| Enterprise Value | $ | 232.3 | 100 | % | ||||
| Less: Debt (1) (2) | (24.6 | ) | ||||||
| Less: Minority Interest (2) (3) | (3.7 | ) | ||||||
| Plus: Cash (1) (2) (4) | 23.6 | |||||||
| Plus: Invest. in Affiliates (2) (3) | 1.3 | |||||||
| Equity Value | $ | 228.8 | ||||||
| Diluted Shares Oustanding (5) | 17.273 | |||||||
| Equity Value / Share | $ | 13.25 |
| 1. | Source: Sight Management. |
| 2. | Balance sheet as of 09/30/10. |
| 3. | Investment in affiliates includes investments in Optispeed Laboratory, Emerald and e-Vision. Minority interest reflects interests in Spherical Optics, Centro Integral Optico S.A. de C.V., Shalens S.A. de C.V., Sight Lens and Sight Australia. |
| 4. | Cash balance adjusted to reflect $13.5mm dividend (approximately $0.804 per share, declared Oct. 13, 2010 and to be paid on or about Nov. 24, 2010 to shareholders if record as of Nov. 8, 2010). |
| 5. | Shares outstanding calculated using treasury stock method. |
| Note: Cash flows discounted using mid-year convention. | |
Discounted Cash Flow Analysis: Sight Management Forecasts
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Discounted Cash Flow Analysis
| Perpetuity Growth Rate | |||||||||||||||||||||
| 2.5% | 3.0% | 3.5% | 4.0% | 4.5% | |||||||||||||||||
| 15.0 | % | $ | 198.7 | $ | 204.8 | $ | 211.4 | $ | 218.7 | $ | 226.6 | ||||||||||
| 14.5 | % | 207.6 | 214.3 | 221.6 | 229.6 | 238.5 | |||||||||||||||
| 14.0 | % | 216.8 | 224.2 | 232.3 | 241.2 | 251.1 | |||||||||||||||
| 13.5 | % | 227.2 | 235.5 | 244.5 | 254.6 | 265.7 | |||||||||||||||
| 13.0 | % | 238.7 | 247.9 | 258.1 | 269.4 | 282.0 | |||||||||||||||
| Implied Terminal Value Multiple | |||||||||||||||||||
| 2.5% | 3.0% | 3.5% | 4.0% | 4.5% | |||||||||||||||
| 15.0 | % | 4.7 | x | 4.9 | x | 5.1 | x | 5.4 | x | 5.7 | x | ||||||||
| 14.5 | % | 4.9 | 5.1 | 5.3 | 5.6 | 5.9 | |||||||||||||
| 14.0 | % | 5.1 | 5.3 | 5.6 | 5.9 | 6.2 | |||||||||||||
| 13.5 | % | 5.3 | 5.6 | 5.9 | 6.2 | 6.6 | |||||||||||||
| 13.0 | % | 5.5 | 5.8 | 6.2 | 6.5 | 7.0 | |||||||||||||
| Perpetuity Growth Rate | |||||||||||||||||||||
| 2.5% | 3.0% | 3.5% | 4.0% | 4.5% | |||||||||||||||||
| 15.0 | % | $ | 11.40 | $ | 11.74 | $ | 12.10 | $ | 12.50 | $ | 12.93 | ||||||||||
| 14.5 | % | 11.89 | 12.26 | 12.66 | 13.10 | 13.59 | |||||||||||||||
| 14.0 | % | 12.40 | 12.80 | 13.25 | 13.74 | 14.28 | |||||||||||||||
| 13.5 | % | 12.97 | 13.42 | 13.92 | 14.47 | 15.08 | |||||||||||||||
| 13.0 | % | 13.60 | 14.11 | 14.66 | 15.28 | 15.97 | |||||||||||||||
Enterprise Value
Equity Value / Share
Implied Perpetuity Growth Rate
DCF Sensitivity Analysis: Sight Management Forecasts
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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| F | Premiums Paid Analysis |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Premiums Paid Analysis
| > | Premiums paid statistics include transactions1 announced since 2005 with: | |
| ● | Transaction values of $150 million to $250 million | |
| ● | Public target companies | |
| ● | 296 transactions total | |
| ● | Includes deals with acquired stakes greater than 50% | |
Premium Paid Analysis
| Financial | Selected Range2 | Per Share Amount | ||||||||||||||||||
| Statistic | Low | High | Low | High | ||||||||||||||||
1 Day Prior 3 | $ | 11.78 | 5.8 | % | 36.3 | % | $ | 12.47 | $ | 16.05 | ||||||||||
1 Week Prior 3 | 10.64 | 8.8 | % | 40.6 | % | 11.57 | 14.96 | |||||||||||||
1 Month Prior 3 | 10.70 | 11.3 | % | 44.9 | % | 11.91 | 15.51 | |||||||||||||
| Average Reference Range | $ | 11.98 | $ | 15.51 | ||||||||||||||||
| Source: Dealogic. | |
| 1. | Transaction types exclude spin-offs, split-offs, exchange offers, repurchases, recapitalizations and restructurings. Transaction types exclude financial services, insurance, real estate and government-related firms. |
| 2. | Range represents 25th to 75th percentile of transaction premiums paid over the stock price one day prior, one week prior and one month prior to transaction announcement date. |
| 3. | Based on closing stock prices prior to 10/14/10. |
Premiums Paid Overview
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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| 3 | Appendix I |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
23
Appendix
| Assumptions | |||||||
Risk Free Rate 1 | 3.0 | % | Marginal Tax Rate | 21.8 | % | ||
Market Risk Premium 2 | 6.7 | % | Cost of Target Debt 4 | 4.4 | % | ||
Equity Size Premium 3 | 6.3 | % |
Cost of Equity Estimate
| Levered | Mkt. Val. | Book Val. | BV Debt/ | BV Debt/ Total | Unlevered | |||||||||||||||
Adj. Beta | Equity | Debt | MV Equity | Market Cap | Adj. Beta | |||||||||||||||
| Optical Comps | ||||||||||||||||||||
| Essilor International | 0.61 | x | $ | 14,080.3 | $ | 1,300.4 | 9.2 | % | 8.5 | % | 0.57 | x | ||||||||
| Hoya Corp. | 0.97 | x | 10,597.7 | 1,348.1 | 12.7 | % | 11.3 | % | 0.88 | x | ||||||||||
| Carl Zeiss Meditec AG | 0.43 | 1,374.8 | 38.6 | 2.8 | % | 2.7 | % | 0.42 | x | |||||||||||
| Safilo Group S.p.A. | 1.22 | 620.1 | 382.9 | 61.7 | % | 38.2 | % | 0.83 | x | |||||||||||
| Marcolin SpA | 0.53 | 254.2 | 50.2 | 19.7 | % | 16.5 | % | 0.46 | x | |||||||||||
| STAAR Surgical Company | 0.89 | 199.6 | 3.4 | 1.7 | % | 1.7 | % | 0.88 | x | |||||||||||
| Small Cap Medical Comps | ||||||||||||||||||||
| ICU Medical, Inc. | 0.74 | x | $ | 526.4 | $ | 0.0 | 0.0 | % | 0.0 | % | 0.74 | x | ||||||||
| Syneron Medical Ltd. | 1.19 | 349.9 | 0.0 | 0.0 | % | 0.0 | % | 1.19 | x | |||||||||||
| Exactech Inc. | 0.97 | 193.4 | 26.0 | 13.4 | % | 11.8 | % | 0.88 | x | |||||||||||
| Consort Medical plc. | 0.20 | 206.6 | 49.5 | 24.0 | % | 19.3 | % | 0.17 | x | |||||||||||
| RTI Biologics, Inc. | 1.28 | 148.0 | 12.1 | 8.2 | % | 7.6 | % | 1.20 | x | |||||||||||
| Solta Medical, Inc. | 0.74 | 131.1 | 10.4 | 7.9 | % | 7.3 | % | 0.69 | x | |||||||||||
| Industry Median | 0.82 | x | $ | 302.0 | $ | 32.3 | 8.7 | % | 8.0 | % | 0.78 | x | ||||||||
| Sight | 0.87 | x | $ | 202.1 | $ | 24.6 | 12.2 | % | 10.8 | % | 0.79 | x | ||||||||
WACC Estimate
| Unlevered Beta | 0.78 | ||||
| Industry BV Debt/MV Equity | 8.7 | % | |||
| Levered Beta | 0.84 | ||||
| Risk Free Rate | 3.0 | % | |||
| Market Risk Premium | 6.7 | % | |||
| Equity Size Premium | 6.3 | % | |||
| Cost of Equity | 14.9 | % |
| Industry BV Debt/MV Equity | 8.7 | % | |||
| Industry BV Debt/Total Market Capitalization | 8.0 | % | |||
| Industry MV Equity/Total Market Capitalization | 92.0 | % | |||
| After-Tax Cost of Debt | 3.4 | % | |||
| Cost of Equity | 14.9 | % | |||
| WACC | 14.0 | % | |||
| 1. | Based on 20-year U.S. Treasury bond yield as interpolated by Bloomberg. |
| 2. | Ibbotson Associates, SBBI 2010 Yearbook, Market Results for 1926-2009. Long-horizon expected equity risk premium of 6.7%; large company stock total returns minus long-term government bond income returns. |
| 3. | Ibbotson Associates, SBBI 2010- Yearbook, Market Results for 1926-2009. Equals 6.3% for market capitalization ranges of $1.0 - $214.1 mm. |
| 4. | Average of 2007 to 2009 weighted average interest rate paid on target debt. |
WACC Analysis
($ in millions, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
24
Appendix
Sight
Small Cap Medical
Optical
| EV / LTM EBITDA | |||||||||||||||
| Small Cap | % Discount to | % Discount to | |||||||||||||
| Sight | Optical | Med | Optical | Small Cap Med | |||||||||||
| 4-Yr Avg | 7.3 | x | 11.2 | x | 11.8 | x | (34.8 | %) | (37.8 | %) | |||||
| 3-Yr Avg | 6.0 | 10.4 | 11.4 | (41.7 | %) | (46.9 | %) | ||||||||
| 2-Yr Avg | 5.0 | 10.0 | 8.0 | (50.6 | %) | (38.3 | %) | ||||||||
| 1-Yr Avg | 5.9 | 11.6 | 8.2 | (49.5 | %) | (28.6 | %) | ||||||||
| Note: | Optical peers include Hoya Corp., Essilor International, Carl Zeiss Meditec AG, Safilo Group SpA, Staar Surgical Co., and Marcolin SpA. Small Cap Medical peers include ICU Medical Inc., Syneron Medical Ltd., Consert Medical Plc, Exactech Inc., RTI Biologics Inc. and Solta Medical Inc. |
| Source: FactSet. | |
Sight vs. Selected Public Companies: Enterprise Value / LTM EBITDA
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Appendix
| ($ in millions) | Industry | Sight | ||||||||||||||
| 2005-2020 | LTG | |||||||||||||||
| 2009 Revenue | % of Revenue | CAGR(1) | Estimate (2) | |||||||||||||
| Europe | $ | 70.8 | 49.7 | % | 2.2 | % | 1.1 | % | ||||||||
| North America | 49.4 | 34.7 | % | 2.5 | % | 0.9 | % | |||||||||
| Rest of World | 22.3 | 15.6 | % | 8.3 | % | 1.3 | % | |||||||||
| Total | $ | 142.4 | 100.0 | % | 5.2 | % | 3.3 | % | ||||||||
Sight Long Term Growth Estimation- Weighted by Geography
| Source: The world market for vision correction; Richard Chaffin and Michael Schaus (2006) and Sight 20F report. | |
| (1) | Estimated long term growth of progressive addition lens buyers, based on the following three factors: Economic Growth (64.4%), Population Growth (25.1%) and Age Mix (10.5%). |
| (2) | Based on Sight’s exposure and industry growth by region. |
Sight Long Term Growth Estimation
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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| 4 | Appendix II |
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
27
Overview of Sight
Projected Revenue and EBITDA Figures
2009 Revenue ($142.4)
Europe
49%
United
States
29%
Asia
7%
Israel
3%
Others
12%
| > | Freeform lenses | ||
| ● | Autograph, Autograph FreeFrame, Autograph Attitude | ||
| ● | Smart Office, Smart Attitude, Smart SV | ||
| ● | Cool | ||
| > | Progressive SF lenses | ||
| ● | Creation | ||
| ● | Genesis | ||
| ● | Piccolo | ||
| ● | Office | ||
| > | SV SF & other lenses | ||
| ● | Single Vision | ||
| ● | SV for Wrap-Around | ||
| ● | Bifocal | ||
| > | Glacier Plus lens coating | ||
| > | Materials | ||
| ● | SuperLite | ||
| ● | Transitions VI | ||
| ● | DriveWear | ||
| ● | NXT | ||
| > | Incorporated in 1970, Sight is a provider of products and technology to the spectacle lens market in the United States, Europe, Israel and the rest of the world |
| > | It develops, designs, manufactures and markets progressive lenses that it sells to the ophthalmic market, utilizing proprietary technology |
| > | Sight provides third-party lens manufacturers with research and development services, in which it develops optical designs and related software tools, and for which its receives payments and future revenues from royalties |
| > | Headquartered in Upper Galilee, Israel |
Key Products
Corporate Overview
| Source: Factset, Company filings and Sight website. |
Sight Overview
(Figures in millions of USD, except per share data)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Overview of Sight
| Name / Title | Background | |
| Amos Netzer | > | President and CEO since July 1, 2009 |
President & CEO Age: 54 | > | Previously, served as the CEO of Spirit Economic Consultants Ltd, as Managing Director of Palram |
| Industries Ltd., as Managing Director of SMS and President of Suntuf | ||
| Dan Katzman | > | Joined in 1981 as an engineer |
| Vice President, R&D & CTO | > | Became Chief Technology Officer and Vice President of R&D in 1985 |
| Age: 55 | ||
| Dagan Avishai | > | Vice President of Sales since 2009 |
Vice President, Sales Age: 50 | > | Previously, served as Vice President of Marketing and Financial Manager of Kibbutz Sight |
| > | Director, Shalag Industries, Ltd. | |
| Yagen Moshe | > | Chief Financial Officer since July 2006 |
| CFO | > | Previously, served as Vice President of Finance, as the Chief Financial Officer of Comsec Ltd., and as a Senior Manager in Ernst & Young |
| Age: 40 | ||
| Shai Michael | > | |
| Vice President, Marketing | ||
| Rami Ben-Zeev | > | Vice President of Sourcing since 2009 |
| Vice President, Sourcing | > | Served as Vice President of Business Management, as Chief Financial Officer of Tel-Hay Rodman Regional College, and Financial Manager of Kibbutz Sight |
Age: 60 | ||
| > | Director, Shalag Industries, Ltd. | |
| Yaniv Hagai | > | |
| Vice President, Operations | ||
| Michael Latzer | > | Chief Executive Officer and President of Sight USA |
| CEO Sight USA | ||
| Hilaire van der Veen | > | Joined in 1992 and, became Vice President of |
| Vice President, Business | Business Development in 2009 | |
Development Age: 56 | > | Previously served as the Chief Executive Officer and President of Sight Insight |
| Raanan Naftalovich | > | Chief Executive Officer of Sight Insight, Inc. since 2005 |
| CEO Sight Insight Inc | ||
| Age: 45 | > | Previously served as Marketing Vice President, Product Manager, Marketing Director, and International Regional Export Manager of Sight and Eyal |
| Name / Title | Background | |
| Uzi Tzur | > | Director and Chairman of the Board since 2007 |
| Chairman of the Board | > | Current Chairman of the Management Board of Kibbutz Sight (since 1992), member of the Board of Directors of |
| Shalag Industries, Ltd, and Chairman of the Board of Mishkai Galil Elion | ||
| Giora Ben-Ze’ev | > | Member of Board of Directors since 1997 |
| > | Served as President and Chief Executive Officer from 1994 to 2008 | |
| Efrat Cohen | > | Member of Board of Directors since 2001 |
| > | Served as Chief Financial Officer of Kibbutz Sight, Director at Shalag Industries, Ltd. and a member of the Management Board of Kibbutz Sight | |
| Ami Samuels | > | Member of Board of Directors since 2005 |
| > | Currently a Managing Director, Private Equity at Poalim Capital Markets Ltd. | |
| > | Was a Partner at Star Ventures and served as Senior Vice President and Chief Financial Officer of Satlynx | |
| > | Chairman of Audit & Compensation Committee | |
| Giora Yanay | > | Member of Board of Directors since 2009 |
| > | Currently Managing Director of Yanai Information Resources Ltd. | |
| > | Served as a Management Consultant at Friedman Turbidy | |
| Inc., Economic Director of Kibbutz Artzi, Managing Director | ||
| of Mivrag Ltd. as well as General Manager of Kibbutz Ein | ||
| Hashofet | ||
| > | Member of Audit & Compensation Committee | |
| Israel Oz | > | Member of Board of Directors since 2009 |
| > | Currently serving as Chairman of the Board of Directors of the Lordan plant in Kfar Sold, Israel | |
| > | Member of Audit Committee & Compensation Committee |
Sight’s Management Team and Board of Directors
Management Team
Board of Directors
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
29
Overview of Sight
| Primary | Gross Diluted (1) | ||||||||
| Holder | # | % | # | % | |||||
| Institutions | |||||||||
| Royce & Associates LLC | 0.796 | 4.7 | % | 0.796 | 4.4 | % | |||
| Renaissance Technologies LLC | 0.089 | 0.5 | % | 0.089 | 0.5 | % | |||
| Clal Finance Mutual Funds Management Ltd. | 0.080 | 0.5 | % | 0.080 | 0.4 | % | |||
| Pyramis Global Advisors LLC | 0.075 | 0.4 | % | 0.075 | 0.4 | % | |||
| IBI Mutual Funds Management (1978) Ltd. | 0.043 | 0.3 | % | 0.043 | 0.2 | % | |||
| Tamir Fishman Mutual Funds Ltd. | 0.038 | 0.2 | % | 0.038 | 0.2 | % | |||
| Yelin Lapidot Mutual Fund Management Ltd. | 0.032 | 0.2 | % | 0.032 | 0.2 | % | |||
| NPC of America | 0.025 | 0.2 | % | 0.025 | 0.1 | % | |||
| Bridgeway Capital Management, Inc. | 0.024 | 0.1 | % | 0.024 | 0.1 | % | |||
| James Investment Research, Inc. | 0.022 | 0.1 | % | 0.022 | 0.1 | % | |||
| Other Institutions | 0.158 | 0.9 | % | 0.158 | 0.9 | % | |||
| Total Institutions | 1.384 | 8.2 | % | 1.384 | 7.6 | % | |||
| Insiders | |||||||||
| Kibbutz Sight | 10.600 | 63.2 | % | 10.600 | 58.1 | % | |||
| Dan Katzman | 0.265 | 1.6 | % | 0.314 | 1.7 | % | |||
Severn Confirmers & Forwarders(2) | 0.145 | 0.9 | % | 0.145 | 0.8 | % | |||
| Management Options | - | 0.0 | % | 0.852 | 4.7 | % | |||
| Employee Options | - | 0.0 | % | 0.580 | 3.2 | % | |||
| Total Insiders | 11.010 | 65.6 | % | 12.491 | 68.4 | % | |||
| Kibbutz Eyal | 0.760 | 4.5 | % | 0.760 | 4.2 | % | |||
| Total Retail | 3.627 | 21.6 | % | 3.618 | 19.8 | % | |||
| Total | 16.781 | 100.0 | % | 18.253 | 100.0 | % | |||
7.6%
Kibbutz Eyal
Total Retail
Total Insiders
Total Institutions
68.4%
19.8%
4.2%
Gross Diluted(1)
| Source: Management, FactSet. | |
| (1) | Gross diluted shares equal primary shares as of 06/15/10 plus total outstanding options. |
| (2) | Represents shareholdings of Hilaire van der Veen, Vice-President, Business Development. |
Ownership Summary
(Figures in millions)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
30
Selected Comparable Company Analysis
| > | Oppenheimer considered two universes of publicly traded companies | ||
| > | Optical Companies | ||
| ● | Ophthalmic manufacturing industry dominated by large, multi-nationals (Hoya and Zeiss) | ||
| – | None are directly comparable to Sight | ||
| – | Differences in business mix (retail), diversification and size | ||
| ● | Emerging players, such as Sight, tend to be privately-held, niche focused and lack scale to effectively compete globally | ||
| > | Small Cap Medical Companies | ||
| ● | Companies that manufacture medical equipment and devices | ||
| ● | Similar in either business model or size, margin and growth profiles | ||
Small Cap Medical Comps
Optical Comps
Selected Public Companies Analysis – Overview
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
31
Comparable Company Analysis
| > | Designs, manufactures, and sells ophthalmic optics for various types of visual disorders as well as providing various optical instruments | |||||||
| $14,080.3 | $14,965.1 | $5,308.5 | $2,985.4 | 56.2% | $1,138.5 | 21.4% | ||
| > | Founded in 1849 and based in France | |||||||
| > | Manufactures and markets advanced optics technologies for the eye care, medical, imaging systems and information | |||||||
| 10,529.1 | 9,657.9 | 5,178.7 | 2,382.1 | 45.4% | $1,373.03 | 26.5% | ||
Offers various end-to–end solutions for the diagnosis and treatment of ophthalmic diseases and visualization solutions for microsurgery | ||||||||
| > | ||||||||
| 1,374.8 | 1,179.5 | 941.6 | 482.4 | 51.6% | 139.9 | 14.9% | ||
Designs, produces and distributes optical frames, sunglasses, sports goggles, lenses and accessories under various licensed brands | ||||||||
| > | ||||||||
| 620.1 | 995.3 | 1,453.7 | 848.5 | 58.4% | 125.2 | 8.6% | ||
| > | Produces and markets prescription frames and lenses, sunglasses and sports eyewear under licensed luxury brand names around the world | |||||||
| 254.2 | 193.2 | 272.7 | 165.4 | 60.6% | 31.7 | 11.6% | ||
| > | Designs, develops, manufactures and markets implantable lenses (IOL) for cataracts and refractive surgery, and sells surgical products | |||||||
| 199.6 | 195.1 | 58.0 | 35.8 | 64.2% | 4.0 | 6.9% |
| (1) | Revenue and EBITDA is LTM for Marcolin SpA. |
Selected Public Companies – Optical
($ in millions)
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Comparable Company Analysis
| > | Develops, manufactures and markets disposable medical connection systems for use in vascular therapy applications | |||||||
| $526.4 | $444.1 | $273.0 | $121.1 | 44.2% | $56.3 | 20.6% | ||
| > | Develops and markets aesthetic medical products based on its proprietary ELOS combining conducted radiofrequency energy and lasers | |||||||
| 349.9 | 150.0 | 187.3 | 89.3 | 47.7% | NM | NM | ||
| > | Develops and markets orthopedic implant devices and related surgical instrumentation and also offers biologic services to hospitals and physicians | |||||||
| 193.4 | 216.8 | 193.0 | 146.3 | 72.0% | 31.7 | 16.4% | ||
| > | Develops specialty medical drug delivery devices as well as disposable airway management products for critical care settings such as hospitals | |||||||
| 206.6 | 259.4 | 201.4 | 126.0 | 65.2% | 43.2 | 21.5% | ||
| > | Produce orthopedic and other surgical implants that repair and promote the natural healing of human bone and other human tissues | |||||||
| 148.0 | 142.3 | 165.1 | 77.0 | 46.6% | 16.7 | 10.1% | ||
| > | Designs, develops, manufactures and markets energy-based medical device systems for aesthetic applications | |||||||
| 131.1 | 104.4 | 114.3 | 75.0 | 65.2% | 12.2 | 10.7% |
Selected Public Companies – Small Cap Medical
($ in millions)
PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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Comparable Company Analysis
| > | Supplies machines for the production of spectacle lenses and lenses for the optics industry |
| > | Manufactures and markets antireflective coating units and surfacing machines, as well as consumables through a global distribution network |
| > | Produces and distributes intra-ocular lenses, ocular surgical implements and pharmaceutical ophthalmic care products to remedy a variety of eye and vision-related problems for people and animals |
| > | The Company’s products treats cataracts, myopia, hyperopia, macular degeneration and more severe problems that require prostheses or reconstruction |
| > | Designs, manufactures and distributes a broad range of eyeglass lenses, primarily focusing on the plastic lens segment |
| > | Sola produces progressive lenses, photochromic lenses, coated lenses and high-index specialty plastic lenses in Single-vision, Multifocal and Plano formats |
| > | Manufactures, markets and distributes the ProClear family of soft contact lenses utilizing its proprietary ProClear technology and a range of non-ProClear contact lenses to treat a variety of vision-related disorders |
| > | The Company was a division of Biocompatibles International plc |
| > | Develops, manufactures and markets specialty soft contact lenses |
| > | Types of lenses include cosmetic lenses, toric lenses, and other premium lenses |
| > | Designs and manufactures contact lens |
Selected Transactions– Optical
($ in millions)
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Comparable Company Analysis
| > | Develops, manufactures, and markets digital hearing aids to the hearing impaired in various models, including behind-the-ear, in-the-ear, half-shell, in-the-canal, mini-canal, and completely-in-the-canal devices |
| > | Designs, manufactures and sells custom dental prosthetic appliances for and to dentists for restorative, reconstructive, and cosmetic procedures |
| > | Also manufactures and markets the NTI-tss plustm device, an appliance for use in the treatment of medically diagnosed migraine pain and jaw disorders |
| > | Supplies hearing aids and equipments to hospitals and the general public in the UK, also exports audiological products, as well as operates hearing centers that provide aftercare services |
| > | Manufactures and supplies surgical and dental instruments to medical and dental professionals in the US, |
| > | Products are used in a variety of surgical settings including ophthalmology, orthopedics and other surgical specialties |
| > | Designs and manufactures electrical stimulation products for pain management, rehabilitation, fitness and sports performance enhancement for use in clinical, home health, sports, and occupational medicine settings |
| > | Also distributes complementary medical devices and consumer products manufactured by others under other name brands |
| > | Designs and manufactures dental equipment and instruments including soft tissue diode lasers, periodontal probes, led operating lights, dental instruments, operatory equipment, and dental laboratory equipments |
| > | Manufactures and sells dental equipment in four primary areas: dental CAD/CAM systems, imaging systems, treatment centers, and instruments |
| > | Supplier of rehabilitation products to hospitals, nursing homes and clinics |
| > | Manufactures and distributes electrical stimulation and orthopedic products for pain management, orthopedic rehabilitation, physical therapy, and fitness and sport performance enhancement used for indications, such as acute pain, chronic pain, disuse atrophy, local blood circulation, muscle re-education and maintain/increase range of motion |
Selected Transactions – Small Cap Medical
($ in millions)
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CONFIDENTIAL
THIS DOCUMENT IS FOR DISCUSSION PURPOSES ONLY AND DOES NOT CONSTITUTE ADVICE OF ANY KIND, INCLUDING TAX, ACCOUNTING, LEGAL OR REGULATORY ADVICE, AND OPPENHEIMER & CO. INC. IS NOT AND DOES NOT HOLD ITSELF OUT TO BE AN ADVISOR AS TO TAX, ACCOUNTING, LEGAL OR REGULATORY MATTERS.
THIS DOCUMENT WAS PREPARED ON A CONFIDENTIAL BASIS SOLELY FOR DISCUSSION BY THE COMPANY AND OPPENHEIMER & CO. INC. AND NOT WITH A VIEW TOWARD PUBLIC DISCLOSURE. THIS DOCUMENT SHALL BE TREATED AS CONFIDENTIAL BY ITS RECIPIENTS.
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PRESENTATION TO THE SPECIAL COMMITTEE OF SIGHT’S BOARD OF DIRECTORS / OCTOBER 14, 2010
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