LONGMONT, CO -- (Marketwire) -- 05/06/12 -- DigitalGlobe, Inc. (NYSE: DGI) ("DigitalGlobe" or the "Company"), a leading global provider of high-resolution earth imagery solutions, today commented on the unsolicited proposal announced by GeoEye, Inc. (NASDAQ: GEOY) ("GeoEye") to acquire the Company for $17.00 per share in a combination of cash and stock.
Consistent with its fiduciary duties and in consultation with its independent financial and legal advisors, the DigitalGlobe Board of Directors reviewed GeoEye's unsolicited acquisition proposal and unanimously determined that it substantially undervalues the Company in relation to DigitalGlobe's standalone business and financial prospects, and is not in the best interests of the Company's stockholders. In addition, the Board determined that GeoEye's proposal does not adequately recognize DigitalGlobe's superior track record of financial and operating performance as well as its constellation's greater capabilities.
DigitalGlobe noted that GeoEye made previous private unsolicited proposals, beginning on February 7, 2012, which the Company believes were motivated by GeoEye's concerns with the disproportionate risks of government budgets cuts affecting its business. DigitalGlobe rejected those proposals, but was willing to discuss DigitalGlobe acquiring GeoEye, and proposed a transaction under which DigitalGlobe's stockholders would own approximately 60% and GeoEye stockholders would own approximately 40% of the combined company, with DigitalGlobe's Chairman and Chief Executive Officer continuing in their respective leadership roles. DigitalGlobe terminated those discussions because the Company believed that the U.S. Government process would be favorable to DigitalGlobe, and that protracted discussions would be disruptive to the U.S. government in its decision-making process as well as create needless distraction to ongoing mission performance.
Following GeoEye's public hostile offer last Friday, DigitalGlobe again made the same proposal for the Company to acquire GeoEye, conditioned on reaching agreement over the weekend. Given GeoEye's rejection of that proposal, DigitalGlobe terminated discussions and will await the government reaching its budget decision regarding EnhancedView. When the government reaches its decision, DigitalGlobe will consider whether to make a proposal to acquire GeoEye.
"DigitalGlobe has consistently demonstrated superior operating performance compared to GeoEye, including the stronger relative performance on the EnhancedView program," said Jeffrey R. Tarr, President and Chief Executive Officer of DigitalGlobe. "DigitalGlobe is the only provider in the industry with a constellation of three healthy on-orbit high resolution satellites, which allows us to deliver vastly more imagery to NGA than GeoEye, both in total and per-taxpayer dollar, generating significant value for the government and taxpayers. We are enthusiastic about our prospects and the opportunities before us, and our ability to successfully execute on our strategic plan to create value for our customers and shareowners."
Mr. Tarr continued, "Given the abruptness of GeoEye's most recent proposal and the companies' past discussions, we believe GeoEye made its hostile bid in desperation due to highly publicized concerns about potential government decisions that may jeopardize their portion of the EnhancedView program. Although we continue to believe there are merits to an acquisition of GeoEye, we believe that it is in the best interests of DigitalGlobe's shareowners and all of our customers to await the conclusion of the government budget decision process and to gain clarity with respect to EnhancedView funding."
The full text of the letter sent today to Matthew M. O'Connell, Chief Executive Officer of GeoEye follows:
May 6, 2012
Mr. Matthew M.