SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 14D-9
(RULE 14d-101)
SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO SECTION 14(d)(4)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. __)
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DATRON SYSTEMS INCORPORATED
(NAME OF SUBJECT COMPANY)
ACQUISITOR PLC
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(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(TITLE OF CLASS OF SECURITIES)
238173108
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(CUSIP NUMBER OF CLASS OF SECURITIES)
MATTHEW J. DAY, ESQ.
118 E. 25TH STREET, 8TH FLOOR
NEW YORK, NEW YORK 10010
(212) 614-0323
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(Name, Address and Telephone Number of Person Authorized to Receive Notice
and Communications on Behalf of the Person(s) Filing Statement)
[x] Check the box if the filing relates solely to preliminary
communications made before the commencement of a tender offer.
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ACQUISITOR PLC
190 The Strand
London
England
WC2R 1JN
OPEN LETTER TO DATRON SHAREHOLDERS
July 3, 2001
Re: Datron Systems Incorporated
Dear Fellow Shareholders:
The past few weeks have been busy for Acquisitor plc, a significant shareholder
of Datron ("Acquisitor"). We approached L-3 Communications Corporation ("L-3")
regarding its interest in acquiring Datron Systems Incorporated ("Datron" or the
"Company") at the same time that Datron was approached by The Titan Corporation
("Titan") to acquire Datron.
We find it interesting that David Derby, Datron's Chairman and Chief Executive
Officer, and Datron's Board of Directors were conspicuous in their absence,
having solicited neither the Titan offer nor the L-3 expression of interest.
Both Mr. Derby in his letter to Acquisitor dated May 4, 2001 (which is filed as
an exhibit to Datron's Current Report on Form 8-K filed on May 4, 2001) and Mr.
George Ball, Chairman of Philpott Ball, Datron's investment bankers, in his
letter to Mr. Lanza, Chairman and CEO of L-3, dated June 25, 2001 have
speculated on Acquisitor's agenda. We would therefore like to set the record
straight as to Acquistor's intentions.
Acquisitor is in the business of creating value in its holdings and has never
received more for its shares than have other shareholders. In fact, because
Acquisitor expends considerable funds in taking an active role in the management
of its holdings to enhance shareholder value, Acquisitor nets significantly less
for its shares than shareholders who do not expend such funds.
Acquisitor met with Mr. Lanza and certain of his colleagues on May 24, 2001 to
discuss a negotiated transaction involving Datron. As a result of that meeting,
Mr. Lanza wrote to us on May 30, 2001 indicating L-3's interest in buying
substantially all of the assets, and assuming the liabilities, of Datron, in a
fully-financed, all-cash offer of $52 million. Promptly after we received the
written expression of interest from L-3, we forwarded it to Mr. Derby. This
expression of interest lapsed on June 8, 2001.
Subsequently, after discussions between Mr. Lanza and Acquisitor, on June 12,
2001, Mr. Lanza made the same written expression of interest directly to Mr.
Derby and the Datron Board of Directors.
Mr. Ball responded on behalf of Datron by letter dated June 13, 2001 (which is
filed as an exhibit to Datron's Current Report on Form 8-K filed on June 27,
2001) stating that an estimated $6 million of the $52 million to be paid in the
proposed asset purchase by L-3 would be required to pay taxes that the Company
would have had to pay on the difference between the sale price and the Book
Value of the Company's assets. We question why Datron did not negotiate with
L-3 after Mr. Lanza submitted to Datron the $52 million fully-financed, all-cash
expression of interest.
As can be seen from Mr. Lanza's letter of June 25, 2001 to Mr. Ball, Mr. Lanza
is perplexed by the Datron Board's lack of common courtesy to even acknowledge
the expression of interest in public, let alone their negotiating a transaction
for the benefit of Datron's shareholders without fully exploring L-3's
expression of interest. Unfortunately we were not privy to the conversation
between Mr. Ball and Mr. Lanza and cannot therefore comment on how things were
left between them.
We can, however, tell you that we hold Mr. Lanza in the highest regard and that
we are shocked that no one from Datron's Board of Directors had the courtesy to
explore Mr. Lanza's expression of interest with him directly. Given Mr. Derby's
public commitment to enhance shareholder value, a quick phone call might have
been time well spent. At the least we would have expected one of the Company's
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independent Directors to have been involved in any discussions with potentially
interested parties. We are also concerned that Datron's Board of Directors would
enter into a definitive agreement with a breakup fee without fully exploring all
alternatives.
We would also like to address price. Unfortunately, we shareholders are
sometimes in need of a reality check. If two major companies offer roughly the
same price for another company it can sometimes be a pretty good indication of
value. In reality given the outlook for Datron's business over the next few
quarters, it might be difficult to justify a significantly higher price, based
on information currently in the public domain. However, someone with all the
facts might well have been in a better position to evaluate the fairness of both
the L-3 expression of interest and the Titan offer. We question why the Board of
Directors of Datron, having received an unsolicited expression of interest from
L-3 as well as an offer from Titan, did not formally auction Datron in order to
optimize value for all of Datron's stockholders. We also question why Datron's
Board of Directors, having two potential suitors and probably others if they had
tried to auction the Company, settled for the first firm offer they received.
In the end, we did and do not care what suitor acquires Datron, only that all
Datron's shareholders receive optimal value for their shares. We firmly believe
that negotiating with L-3 and any other potential suitors, let alone conducting
a formal auction process, would have been the best way to assure that
shareholders receive optimal value.
Fellow shareholders, we cannot advise you whether to tender your Datron stock
for Titan stock or not, nor would we presume to do so. We can, however, inform
you of our intentions. FIRSTLY, WE WILL NOT BE MAKING ANY DECISION UNTIL AFTER
WE HAVE REVIEWED IN DETAIL THE SOLICITATION MATERIAL. SECONDLY, MUCH AS WE ARE
NOT INTERESTED IN OWNING TITAN STOCK, WE WILL REVIEW THE SITUATION AS IT
DEVELOPS. UNLESS TITAN'S STOCK IS TRADING SUBSTANTIALLY IN EXCESS OF $20 PER
SHARE WE WOULD HAVE LITTLE INTEREST IN EXCHANGING OUR DATRON SHARES FOR TITAN
SHARES.
Sincerely,
Duncan Soukup
Managing Director
Acquisitor plc
cc: the Board of Directors of Datron Systems Incorporated
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