SOFTWARE INDUSTRY NEWS

Google and On2 agree on amended merger agreement

09 January 2010 , Written by Dhruv Tanwar
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On2 Technologies, Inc. has said it has agreed with Google Inc. to amend the merger agreement under which Google will acquire On2. On2's technology makes it easier to transmit video over the Internet through compression.

As per the revised terms, each outstanding On2 share of common stock will receive 0.0010 of a share of Google Class A common stock for each share of On2 common stock, as previously announced, plus an additional $0.15 per share in cash consideration. Google said that these terms constitute its final offer.

Earlier this week, Google sweetened its offer by revising the terms acquiring for On2 Technologies by including the cash portion, which in effects increases the value of the deal by 20 percent to $134 million, offering $26.5 million more than Google's previous offer. The total value offered now amounts to 76 cents per share in cash and stock, against On2's mid-week closing price of 60 cents per share on Wednesday on the American Stock Exchange for it 176.6 million outstanding shares.

Google said it would file a supplement to the proxy statement / prospectus of November 3, 2009. which will describe revisions to the merger agreement. It said it would mail the same to O2's holders of common stock as of the close of business on January 15, 2010, the new record date for the further adjourned Special Meeting of On2's stockholders.

On2's board of directors approved the amendment to the merger agreement and recommends that On2's stockholders approve the amended merger agreement and the merger proposal.
 

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