Intersect ENT Board review. The Transaction Advisory Committee was comprised of the following Intersect ENT Board members: Kieran Gallahue, Dana Mead and Cindy Lucchese, each of whom are independent directors and were chosen based on their experience with strategic transactions, existing roles on our Intersect ENT Board and willingness to serve on the Transaction Advisory Committee. In addition, the Intersect ENT Board agreed to engage Goldman Sachs & Co. LLC as financial advisor to Intersect ENT (“Goldman Sachs”) and Cooley LLP as Intersect ENT’s outside legal counsel (“Cooley”) for the purpose of assisting the Intersect ENT Board in evaluating the acquisition proposal letter. Over the course of the next few weeks, Intersect ENT senior management, Intersect ENT’s advisors and the Transaction Advisory Committee worked to develop their analyses of the proposed acquisition and of Intersect ENT’s various alternatives thereto in order to present their analyses to the full Intersect ENT Board and respond to the Medtronic offer.
On July 7, 2020, Intersect ENT’s Transaction Advisory Committee held a meeting via teleconference where members of Intersect ENT senior management and Goldman Sachs, relying on certain financial projections prepared by Intersect ENT senior management and approved for Goldman Sachs’ use, presented a valuation model and analysis of the proposed acquisition to Intersect ENT’s Transaction Advisory Committee. Later in the afternoon, after the close of the U.S. financial markets, a Bloomberg article reported that Medtronic had made an offer to acquire Intersect ENT. On July 7, 2020, shares of Intersect ENT common stock closed on Nasdaq at $13.89 per share.
On the morning of July 8, 2020, the Intersect ENT Board held a telephonic meeting with members of Intersect ENT senior management, representatives from Goldman Sachs, and representatives from Cooley in attendance. At the meeting, the Intersect ENT Board discussed the acquisition proposal and determined that the proposed purchase price of $17.50 per share was insufficient to enter into a transaction. The Intersect ENT Board directed the Intersect ENT senior management team to convey this message to Medtronic.
On July 9, 2020, Mr. West contacted Mr. Cleary by telephone and indicated that Medtronic’s proposed purchase price was insufficient to enter into a transaction with Medtronic.
On July 9, 2020, Company A, a competitor in the medical device industry, contacted Mr. West to set up a call for the following day.
On July 10, 2020, Mr. West held a telephonic meeting with a representative of Company A. At the meeting, the representative of Company A noted that they were not planning to make an acquisition proposal, but would like to be included in the process if Intersect ENT decided to engage in a full strategic transaction process.
On July 13, 2020, Medtronic sent Mr. West a revised acquisition proposal letter with a purchase price of $18.50 per share.
On July 14, 2020, Mr. West and Mr. Cleary spoke by telephone, Mr. West confirmed receipt of the revised offer and noted that he would review the offer with the Intersect ENT Board for consideration the following day.
On July 15, 2020, the Intersect ENT Board met with the Intersect ENT senior management team and Intersect ENT’s advisors to discuss the revised offer. After a thorough review of certain financial projections prepared by Intersect ENT senior management, the operating risks relating to the COVID-19 pandemic, Goldman Sachs’ financial analysis and valuation based on these projections and feedback and advice from Cooley, the Intersect ENT Board determined that an offer in the “mid-twenties” would be necessary to proceed and that Mr. West should convey this price target to Medtronic. The Intersect ENT Board indicated that the Intersect ENT senior management team should also deliver a management presentation in order to provide Medtronic with a detailed understanding of Intersect ENT and a high-level, preliminary view of potential synergies with Medtronic.
On July 16, 2020, Mr. West spoke to Mr. Cleary, noting that Intersect ENT would consider a transaction where Intersect ENT would be acquired for a purchase price in the mid-20s per share. Mr. Cleary noted that he would consider the proposal.
On July 21, 2020, Mr. Cleary contacted Mr. West and both agreed that a management presentation might provide the basis for Medtronic seeing increased value for its bid to meet Intersect ENT’s valuation expectations.
On July 28, 2020, Mr. West spoke to Mr. Cleary and finalized the details for the agreed management presentation to further Medtronic’s understanding of Intersect ENT, subject to entering into a confidentiality agreement, which would provide for, among other terms, a standstill obligation for a minimum period of six months. Mr. Cleary accepted. Later that day, Intersect ENT and Medtronic executed a confidentiality agreement,