Comptel - Tender offer

Statement of the Board of Directors of Comptel Corporation regarding the voluntary public tender offer by Nokia

Comptel Corporation, Stock Exchange Release, February 21, 2017 at 3 PM EET



NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, SOUTH
AFRICA OR HONG KONG OR IN ANY OTHER JURISDICTION IN WHICH THE TENDER OFFER
WOULD BE PROHIBITED BY APPLICABLE LAW. 



Statement of the Board of Directors of Comptel Corporation regarding the
voluntary public tender offer by Nokia 

Nokia Corporation (“Nokia”) and Comptel Corporation (“Comptel” of the
“Company”) have announced on February 9, 2017 that Nokia through its wholly
owned indirect subsidiary Nokia Solutions and Networks Oy (the “Offeror”),
makes a voluntary public cash tender offer to purchase all of the issued and
outstanding shares and option rights in Comptel that are not owned by Comptel
or any of its subsidiaries (the “Tender Offer”). 

The Board of Directors of Comptel has on February 21, 2017 decided to issue the
below statement regarding the Tender Offer as required by the Finnish
Securities Markets Act (746/2012, as amended). 



TENDER OFFER IN BRIEF

Nokia and Comptel have on February 8, 2017 entered into a transaction agreement
(the “Transaction Agreement”) setting out, among others, the terms and
conditions pursuant to which the Tender Offer shall be made by Nokia through
the Offeror. 

The Tender Offer will be made in accordance with the terms and conditions of
the tender offer document expected to be published by the Offeror on or about
February 24, 2017 (the “Tender Offer Document”). 

The offer price is EUR 3.04 in cash for each share in Comptel. The share offer
price represents a premium of: 

28.8 percent compared to the closing price of the shares on Nasdaq Helsinki
Ltd. (“Nasdaq Helsinki”) on February 8, 2017, the last trading day before the
announcement of the Tender Offer; and 51.2 percent compared to the
volume-weighted average trading price of the Comptel shares on Nasdaq Helsinki
during the 12-month period preceding the date of the announcement of the Tender
Offer. The price offered for each option right granted under Comptel’s share
option schemes 2014 and 2015 and validly tendered in the Tender Offer will be
EUR 2.56 in cash for each 2014A option right, EUR 2.16 in cash for each 2014B
option right, EUR 1.53 in cash for each 2014C option right, EUR 2.15 in cash
for each 2015A option right and EUR 2.15 in cash for each 2015B option right. 

Any distribution of dividend or other assets by Comptel after the date of the
Transaction Agreement shall reduce the Share Offer Price by an amount equal to
such dividend or distribution per share. Such distribution shall not affect the
offer price for the Comptel option rights. 

The offer period under the Tender Offer is expected to commence on or about
February 27, 2017 and to run for approximately four (4) weeks. The Offeror
reserves the right to extend the offer period from time to time in accordance
with the terms and conditions of the Tender Offer. 

Pursuant to the Transaction Agreement, the Offeror is to acquire all issued and
outstanding shares and all issued and outstanding option rights in Comptel. 

The Tender Offer will be financed through Nokia group’s internal financing
arrangements and no third party financing is required by the Offeror to
complete the Tender Offer. The Tender Offer is thus not conditional upon
obtaining any financing for the Tender Offer. 

The following major shareholders of Comptel have irrevocably undertaken to
accept the Tender Offer subject to certain customary conditions: Mandatum Life
Insurance Company Limited, Elisa Corporation, Kaleva Mutual Insurance Company,
Varma Mutual Pension Insurance Company and Ilmarinen Mutual Pension Insurance
Company as well as the members of the Comptel Board of Directors and the
President and CEO of Comptel (personally and through an entity in his control),
representing jointly approximately 48.3 percent of the shares and votes in
Comptel. 

The Tender Offer is subject to, among others, approvals by the relevant
regulatory authorities, such as competition authorities, and the Offeror
gaining control of more than 90 percent of the outstanding Comptel shares on a
fully diluted basis. 



STATEMENT OF THE BOARD OF DIRECTORS

1. Background for the statement

Pursuant to the Finnish Securities Market Act, the Board of Directors of
Comptel shall prepare a public statement regarding the Tender Offer. 

The statement shall include a well-founded assessment of the Tender Offer from
the perspective of Comptel and its shareholders as well as of the strategic
plans and their likely effects on the operations and employment of Comptel
presented by the Offeror in the Tender Offer Document. 

For the purposes of issuing this statement, the Offeror has submitted to the
Board of Directors of Comptel the draft version of the Finnish language Tender
Offer Document in the form in which the Offeror has filed it with the Finnish
Financial Supervisory Authority for approval on February 16, 2017. 

In preparing its statement, the Board of Directors of Comptel has relied on
information provided in the Offeror’s announcement regarding the Tender Offer
published on February 9, 2017 and the draft Tender Offer Document by the
Offeror and has not independently verified this information. Accordingly, the
Board of Directors’ assessments of the consequences of the Tender Offer on
Comptel’s business and employees should be treated with caution. 



2. Assessment regarding strategic plans presented by the Offeror and their
likely effects on the operations and employment of Comptel 

Information given by the Offeror in the Tender Offer Document

The Board of Directors of Comptel has assessed the Offeror’s strategic plans
based on the statements in Offeror’s announcement regarding the Tender Offer
published on February 9, 2017 and the draft Tender Offer Document. 

Based on information provided by Nokia, it is the intention of Nokia and the
Offeror that Comptel will continue to operate as a separate unit, but its
businesses might be eventually harmonized with and/or integrated into the
standalone software business operated by Applications & Analytics business
group of Nokia group based upon an integration plan to be developed by the
management of Nokia. Further, Nokia has presented that certain employees and
members of senior management of Comptel will play an important role in Nokia’s
organization following the completion of the Tender Offer. Nokia has set forth
that in order to encourage these key employees of Comptel to remain in the
Company, the Offeror intends to offer them certain retention arrangements
following the completion of the Tender Offer. The Offeror, however, intends,
based on information provided by Nokia, to change the composition of the Board
of Directors of Comptel after the completion of the Tender Offer. 

According to Nokia, the planned acquisition is part of Nokia’s strategy to
build a standalone software business at scale by expanding and strengthening
its software portfolio and go-to-market capabilities with additional sales
capacity and a strategic partner network.  Comptel would bolster Nokia’s
software portfolio by adding critical solutions for catalogue-driven service
orchestration and fulfillment, intelligent data processing, customer
engagement, and agile service monetization.  The combination of Nokia’s Service
Assurance portfolio and Comptel’s Service Orchestration portfolio would enable
a dynamic closed loop between service assurance and fulfillment that simplifies
management of complex heterogeneous networks. When combined with Nokia’s
Cloudband(TM) and Nuage(TM) portfolios, Nokia would be able to provide
customers with complete, end-to-end orchestration of complex Network Function
Virtualization (NFV) and Software Defined Networking (SDN) deployments. 

In November 2016, Nokia announced its long-term strategy, Rebalancing for
Growth. As part of the strategy, Nokia is strengthening its software
capabilities in key areas: portfolio, services and go-to-market. The planned
acquisition of Comptel would bolster go-to-market efforts with a
software-dedicated sales force and strong partner network. It would also
support Nokia’s desire to build a portfolio that allows customers to automate
as much of their network and business operations as possible – including
customer services, self-optimization, management and orchestration. Comptel
would help with this objective by bringing catalogue-driven fulfilment and
digital service lifecycle management, complex event processing, applications
for customer engagement and service monetization; and emerging technologies for
context-aware on-device commerce and IoT pattern detection. 

The Tender Offer is not expected to have a material effect on the operations
and business locations of, or on the number of jobs at Comptel. 



Board assessment

The Board of Directors of Comptel believes that Nokia’s global reach, strength
of brand, and cross-selling opportunities will benefit the activities of
Comptel. Comptel will also gain entry to new markets in which Nokia already has
a strong presence, especially the United States. The greater size and financial
strength of Nokia could also enhance Comptel’s position with respect to its
existing and potential customers. Combining Comptel’s business with Nokia’s
will offer the customers of both Comptel and Nokia a wider and more innovative
software portfolio  which could improve the competitiveness of the combined
business unit especially in the eyes of larger customers. The Board of
Directors of Comptel believes that the combination will also deepen the network
know-how of the combined entity. 

The Board of Directors of Comptel believes that the combination creates an
agile player in the OSS market and forms a foundation for profitable growth and
innovation. Combining Comptel’s business with a large and recognized player
such as Nokia, Comptel’s long-time partner, will also reduce risks related to
Comptel’s current business, which result from the consolidation between the
market players in Comptel’s sector and potential failures in the development or
launch of new product areas, among others. In addition to these benefits to
Comptel and its customers, the combination of Comptel’s business with Nokia
will also create opportunities for personal and professional development for
the employees of Comptel. 

The Board of Directors of Comptel considers that the information on the
Offeror’s strategic plans concerning Comptel included in the announcement
regarding the Tender Offer published on February 9, 2017 and in the draft
Tender Offer Document is of a general nature. However, based on information
presented to Comptel and its Board of Directors, the Board of Directors of
Comptel evaluates that the completion of the Tender Offer is not expected to
have any material effect on Comptel’s operations and business locations or on
the number of jobs at Comptel. 

On the date of this statement the Board of Directors of Comptel has not
received any formal statement as to the effects of the Tender Offer to the
employments at Comptel from Comptel's employees. 



3. Assessment of the Board of Directors from the perspective of Comptel and its
shareholders and holders of option rights 

Introduction

In evaluating the Tender Offer, analyzing alternative opportunities available
to Comptel and concluding on its statement, the Board of Directors has
considered several factors, such as Comptel’s recent financial performance,
current position and future prospects, and the historical trading price of
Comptel’s share. 

The Board of Directors’ assessment of continuing the business operations of
Comptel as an independent company has been based on reasonable future-oriented
estimates which include uncertainties, whereas the offer consideration and the
premium included therein is not subject to any uncertainty other than the
fulfillment of the conditions to completion of the Tender Offer. 

In order to support its assessment of the Tender Offer, the Board of Directors
of Comptel has received a fairness opinion regarding the Tender Offer (the
“Fairness Opinion”) from Comptel’s financial advisor, Sisu Partners. The
Fairness Opinion, subject to the assumptions and qualifications set out therein
and dated February 8, 2017, states that the offer consideration, from a
financial point of view, is believed to be fair. The Fairness Opinion is
attached as Appendix 1 to this statement. 



Board assessment

The Board of Directors of Comptel believes that the consideration offered by
the Offeror to the shareholders and holders of option rights is fair to such
holders based on an assessment of the issues and factors, which the Board of
Directors has concluded to be material in evaluating the Tender Offer. These
include, amongst other factors: 

  -- the premium being offered;
  -- historical trading price of Comptel’s share taking into account the fact
     that, in the opinion of the Board of Directors of Comptel, Comptel’s future
     value creation potential has been reflected in the current trading price to
     a large extent;
  -- the information and assumptions on the business operations and finances of
     Comptel at the date of this statement and their expected future development
     including
     -- the consolidation trend between the market players in Comptel’s sector
        and the risks for smaller players to be left out of delivery contracts;
     -- Comptel’s new product areas, analytics and automation of customer’s
        delivery processes, will require significant investments in the future
        to remain competitive;
     -- development or launch of new product areas involves uncertainties;
  -- the valuation multiples of Comptel shares compared to the industry
     multiples before the announcement of the Tender Offer;
  -- valuations and analysis made and commissioned by the Board of Directors as
     well as discussions with external financial advisors;
  -- the support by significant shareholders in Comptel for the Tender Offer;
     and
  -- the Fairness Opinion issued by Sisu Partners.

The Board of Directors has concluded that the relevant business prospects of
Comptel provide opportunities for Comptel to develop its business as an
independent company for the benefit of Comptel and its shareholders and holders
of option rights. However, taking into consideration the risks and
uncertainties associated with such stand-alone approach as well as the terms
and conditions of the draft Tender Offer Document, the Board of Directors has
concluded that the Tender Offer is a more favorable alternative for the
shareholders and holders of option rights. 

Comptel has in the Transaction Agreement agreed to a standard non-solicitation
clause whereby Comptel has undertaken not to solicit competing proposals or,
subject to the fiduciary duties of the Board of Directors of Comptel, promote
the progress of such proposals. Having carefully assessed the terms and
conditions of the Tender Offer, the Board of Directors of Comptel has concluded
that entering into the Transaction Agreement, including said non-solicitation
clause, is in the interest of Comptel’s shareholders and holders of option
rights. 



4. Recommendation of the Board of Directors

The Board of Directors of Comptel has carefully assessed the Tender Offer and
its terms and conditions based on the draft Tender Offer Document, the Fairness
Opinion, and other available information. 

Based on the foregoing, the Board of Directors of Comptel deems that the Tender
Offer and the amount of the offer consideration offered for the shares and
option rights are under the prevailing circumstances fair to Comptel
shareholders and holders of option rights. 

Given the above-presented viewpoints, the Board of Directors of Comptel
unanimously recommends that the shareholders of Comptel and holders of option
rights accept the Tender Offer. 

This statement is based on an assessment of the issues and factors which the
Board of Directors has concluded to be material in evaluating the Tender Offer,
including, but not limited to, the information and assumptions on the business
operations and finances of Comptel at the date of this statement and their
expected future development. 

All members of the Board of Directors have participated in the decision making
concerning the statement. The evaluation of independence of the members of the
Board of Directors is available on the website of Comptel. 



5. Other Issues

The Board of Directors of Comptel notes that combining the operations of
Comptel with Nokia’s operations will, in addition to synergy benefits, pose
challenges to both parties, and the combination may, as is common in such
processes, involve unforeseeable risks. 

The Board of Directors of Comptel notes that the shareholders and holders of
option rights of Comptel should also take into account the risks related to
non-acceptance of the Tender Offer. If the Offeror waives the acceptance
condition of 90 per cent of the shares and votes, the completion of the Tender
Offer would reduce the number of Comptel shareholders and the number of shares,
which would otherwise be publicly traded. Depending on the number of shares
validly tendered in the Tender Offer, this could have an adverse effect on the
liquidity and value of the shares. 

Pursuant to Chapter 18 of the Finnish Companies Act (624/2006, as amended), a
shareholder with more than 90 per cent of all shares and votes in a company
shall have the right to acquire, and subject to a demand by the other
shareholders also be obligated to redeem, the shares owned by the other
shareholders. The shares held by Comptel’s shareholders who have not accepted
the Tender Offer may be redeemed through compulsory redemption proceedings
under the Finnish Companies Act under the conditions set out therein. 

Comptel has undertaken to comply with the Helsinki Takeover Code referred to in
Chapter 11 Section 28 of the Finnish Securities Markets Act. 

This statement of the Board of Directors of Comptel does not constitute
investment or tax advice, and the Board of Directors of Comptel does not
specifically evaluate herein the general price development or the risks
relating to the shares in general. Shareholders and holders of option rights
must independently decide whether to accept the Tender Offer, and they should
take into account all relevant information available to them, including
information presented in the Tender Offer Document and this statement as well
as any other factors affecting the value of the shares. 

Comptel is being advised by Sisu Partners as financial advisor and Castrén &
Snellman Attorneys Ltd. as legal advisor. 



THE BOARD OF DIRECTORS OF COMPTEL



Further information:

Comptel

Tom Jansson

Chief Financial Officer

tel. +358 40 700 1849

tom.jansson@comptel.com





APPENDIX: Sisu Partners’ Fairness Opinion





ABOUT COMPTEL



Life is digital moments. Comptel perfects these by transforming how you serve,
meet and respond to the needs of “Generation Cloud” customers. 

Our solutions allow you to innovate rich communications services instantly,
master the orchestration of service and order flows, capture data-in-motion and
refine your decision-making. We apply intelligence to reduce friction in your
business. 

Comptel has enabled the delivery of digital and communications services to more
than 2 billion people. Every day, we care for more than 20% of all mobile usage
data. Nearly 300 service providers across 90 countries have trusted us to
perfect customers’ digital moments. 

For more information, visit www.comptel.com.



NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, SOUTH
AFRICA OR HONG KONG OR IN ANY OTHER JURISDICTION IN WHICH THE TENDER OFFER
WOULD BE PROHIBITED BY APPLICABLE LAW. 



Forward-Looking Statements

This stock exchange release contains statements that, to the extent they are
not historical facts, constitute "forward looking statements''. Forward looking
statements include statements concerning our plans, expectations, projections,
objectives, targets, goals, strategies, future events, future revenues or
performance, capital expenditures, financing needs, plans or intentions
relating to acquisitions, our competitive strengths and weaknesses, plans or
goals relating to financial position, future operations and development, our
business strategy and the trends we anticipate in the industries and the
political and legal environment in which we operate and other information that
is not historical information. In some instances, they can be identified by the
use of forward-looking terminology, including the terms "believes", "intends",
"may", "will" or "should" or, in each case, their negative or variations on
comparable terminology. By their very nature, forward looking statements
involve inherent risks, uncertainties and assumptions, both general and
specific, and risks exist that the predictions, forecasts, projections and
other forward looking statements will not be achieved. Given these risks,
uncertainties and assumptions, investors are cautioned not to place undue
reliance on such forward looking statements. Any forward looking statements
contained herein speak only as at the date of this stock exchange release. 

THIS RELEASE MAY NOT BE RELEASED OR OTHERWISE DISTRIBUTED, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, AUSTRALIA,
SOUTH AFRICA OR HONG KONG OR IN ANY OTHER JURISDICTION IN WHICH THE TENDER
OFFER WOULD BE PROHIBITED BY APPLICABLE LAW. 

THIS RELEASE IS NOT A TENDER OFFER DOCUMENT AND AS SUCH DOES NOT CONSTITUTE AN
OFFER OR INVITATION TO MAKE A SALES OFFER. IN PARTICULAR, THIS RELEASE IS NOT
AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
DESCRIBED HEREIN, AND IS NOT AN EXTENSION OF THE TENDER OFFER, IN THE UNITED
STATES, CANADA, JAPAN, AUSTRALIA, SOUTH AFRICA OR HONG KONG. INVESTORS SHALL
ACCEPT THE TENDER OFFER FOR THE SHARES AND OPTION RIGHTS ONLY ON THE BASIS OF
THE INFORMATION PROVIDED IN A TENDER OFFER DOCUMENT. OFFERS WILL NOT BE MADE
DIRECTLY OR INDIRECTLY IN ANY JURISDICTION WHERE EITHER AN OFFER OR
PARTICIPATION THEREIN IS PROHIBITED BY APPLICABLE LAW OR WHERE ANY TENDER OFFER
DOCUMENT OR REGISTRATION OR OTHER REQUIREMENTS WOULD APPLY IN ADDITION TO THOSE
UNDERTAKEN IN FINLAND. 

THE TENDER OFFER IS NOT BEING MADE DIRECTLY OR INDIRECTLY IN ANY JURISDICTION
WHERE PROHIBITED BY APPLICABLE LAW AND, WHEN PUBLISHED, THE TENDER OFFER
DOCUMENT AND RELATED ACCEPTANCE FORMS WILL NOT AND MAY NOT BE DISTRIBUTED,
FORWARDED OR TRANSMITTED INTO OR FROM ANY JURISDICTION WHERE PROHIBITED BY
APPLICABLE LAW. IN PARTICULAR, THE TENDER OFFER IS NOT BEING MADE, DIRECTLY OR
INDIRECTLY, IN OR INTO, OR BY USE OF THE POSTAL SERVICE OF, OR BY ANY MEANS OR
INSTRUMENTALITY (INCLUDING, WITHOUT LIMITATION, FACSIMILE TRANSMISSION, TELEX,
TELEPHONE OR THE INTERNET) OF INTERSTATE OR FOREIGN COMMERCE OF, OR ANY
FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF, THE UNITED STATES, CANADA,
JAPAN, AUSTRALIA, SOUTH AFRICA OR HONG KONG. THE TENDER OFFER CANNOT BE
ACCEPTED, DIRECTLY OR INDIRECTLY, BY ANY SUCH USE, MEANS OR INSTRUMENTALITY OR
FROM WITHIN THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, SOUTH AFRICA OR HONG
KONG.

Attachments:

Sisu Partners Fairness Opinion.pdf