BOCA RATON, Fla.--(BUSINESS WIRE)--Feb. 21, 2018--
Cogint, Inc. (NASDAQ: COGT) today announced an update to the transaction
previously entered into with BlueFocus International Limited
(“BlueFocus”). cogint had entered into a business combination with
BlueFocus under which cogint and BlueFocus were to combine their
businesses and cogint would spin-off its data and analytics business,
Red Violet, into a separate public company. As a condition to closing
the transaction, the parties sought regulatory approval by the Committee
on Foreign Investment in the United States (CFIUS). As a result of the
political climate regarding Chinese-based acquirers of U.S. companies,
CFIUS has indicated its unwillingness to approve the transaction.
Therefore, the parties have withdrawn their application and terminated
the business combination agreement. cogint will continue with the
accelerated spin-off of Red Violet, and expects to announce a record
date for the spin-off within the next few weeks, subject to the SEC's
clearance of the Red Violet Registration Statement on Form 10 and
meeting all other conditions to the spin-off. cogint's Board of
Directors has authorized management to establish a record date for the
spin-off at the time all such conditions have been met and expects to
declare a spin-off dividend of one share of Red Violet common stock for
every four to five shares of cogint common stock held on the record
date, subject to the requirements of the Delaware General Corporation
Law.
“Despite a seamless CFIUS review process over the last several months,
CFIUS has indicated its unwillingness to approve the transaction,” said
Derek Dubner, CEO of cogint. “Undeterred by this decision stemming from
the political climate surrounding China-based acquirers, we are
committed to continuing to create shareholder value and proceeding with
the spin-off of our data and analytics business, Red Violet, into an
independent publicly-traded company and expect to distribute the shares
to our shareholders as a dividend.”
“Additionally, our digital marketing business, Fluent, which we believe
today is more valuable than the $415 million valuation assigned by the
BlueFocus transaction, will be 100% owned by our shareholders, as a
standalone public company, as opposed to 37% owned as originally
contemplated by the BlueFocus transaction. While we will not be
providing the associated cash dividend with the transaction, our
shareholders will own 100% of two very valuable public companies. We are
of the firm belief that the sum of the parts is worth greater than the
valuation assigned to our company by today’s market.”
Upon the spin-off, Red Violet expects to have approximately $20 million
in cash and no debt. Post spin-off, the Company expects Fluent to be
profitable from day one.
Given Fluent’s performance in 2017 and year-to-date, the Company is
providing full-year 2018 guidance for Fluent alone, as a standalone
public company, of $238 - $245 million in revenue and $38 - $45 million
in EBITDA.
About cogint™
At cogint, we believe that time is your most valuable asset. Through
powerful analytics, we transform data into intelligence, in a fast and
efficient manner, so that our clients can spend their time on what
matters most – running their organizations with confidence. Through
leading-edge, proprietary technology and a massive data repository, our
data and analytical solutions harness the power of data fusion,
uncovering the relevance of disparate data points and converting them
into comprehensive and insightful views of people, businesses, assets
and their interrelationships. We empower clients across markets and
industries to better execute all aspects of their business, from
managing risk, conducting investigations, identifying fraud and abuse,
and collecting debts, to identifying and acquiring new customers. At
cogint, we are dedicated to making the world a safer place, to reducing
the cost of doing business, and to enhancing the consumer experience.
Note to Investors Concerning Forward-Looking Statements
This press release contains “forward-looking statements,” as that term
is defined under the Private Securities Litigation Reform Act of 1995
(PSLRA), which statements may be identified by words such as “expects,”
“plans,” “projects,” “will,” “may,” “anticipate,” “believes,” “should,”
“intends,” “estimates,” and other words of similar meaning. Such forward
looking statements include statements relating to whether we will be
able to achieve SEC clearance of Red Violet’s registration statement and
the other conditions for the Red Violet spin-off; whether we will
announce a record date for the Red Violet spin-off within the next few
weeks; whether the spin-off dividend will be one share of Red Violet
common stock for every four to five shares of cogint shares on the
record date; whether Fluent is more valuable than the $415 million
valuation assigned by the BlueFocus transaction; whether Fluent and Red
Violet are worth more as separate independent public companies than
together; whether Red Violet will have approximately $20 million in cash
and no debt upon the spin-off; whether Fluent will be profitable from
day one; and whether Fluent, as a standalone public company, will have
2018 revenue of $238-$245 million and 2018 EBIDTA of $38-$45 million.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which are based on our expectations as of
the date of this press release and speak only as of the date of this
press release and are advised to consider the factors listed above
together with the additional factors under the heading “Forward-Looking
Statements” and “Risk Factors” in the Company’s Annual Report on Form
10-K, as may be supplemented or amended by the Company’s Quarterly
Reports on Form 10-Q and other SEC filings, as well as other
non-historical statements about our expectations, beliefs or intentions
regarding our business, technologies and products, financial condition,
strategies or prospect. Additional risks may include the diversion of
management time on transaction-related issues; the ability to
successfully separate cogint’s data and analytics operations and assets;
and the risk that the common stock of Red Violet is not listed on
NASDAQs. We undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180221005497/en/
Source: Cogint, Inc.
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