Silver Lake Makes $1B Investment in Motorola, Settles Outstanding Debt
Thursday, September 05, 2019 | Comments

Motorola Solutions announced Silver Lake will make a new $1 billion investment in Motorola Solutions and settle its outstanding $800 million aggregate principal investment one year ahead of its maturity.

Under the terms of the new agreement, Silver Lake will purchase $1 billion aggregate principal amount of 1.75% convertible senior unsecured notes due 2024 using capital from a more recent fund to extend Silver Lake’s commitment and enable a longer hold period. The notes will have an initial conversion price of $203.50 per share. They will mature in September 2024 unless earlier repurchased, redeemed or converted.

“The Silver Lake partnership has been outstanding, and I’m very pleased that we’re continuing it,” said Greg Brown, chairman and CEO of Motorola Solutions. “Our relentless focus on people, platforms, growth and shareholder return has proven to be very successful, and I’m excited about the opportunities we have in front of us.”

Silver Lake and Motorola will settle outstanding the $800 million aggregate principal amount of 2% convertible senior unsecured notes due 2020. Motorola Solutions will pay Silver Lake approximately $1.1 billion in cash and issue about 5.5 million shares, which is fewer than the second quarter diluted share count that assumed settlement of the full premium for the 2020 notes in shares.

Egon Durban and Greg Mondre, managing partners and managing directors of Silver Lake, will remain on the Motorola Solutions board.

“Motorola Solutions is a great company that has evolved into a leading mission-critical technology platform addressing the societal challenge of public safety,” said Durban and Mondre. “Greg, the management team and employees have delivered extraordinary growth and shareholder value through innovative product development and world-class services for their customers. Silver Lake is excited to extend our partnership with the team and the rest of the board. The company is positioned for continued growth with exciting new opportunities across its mission-critical communications, command center software and video analytics platform offerings.”

Goldman, Sachs & Co. acted as financial advisors to Motorola Solutions, and Wachtell, Lipton, Rosen & Katz served as Motorola Solutions’ legal advisor in the transactions. Simpson Thacher & Bartlett served as Silver Lake’s legal advisor.

Motorola Solutions also announced an underwritten public offering of 5,471,271 shares of the company’s common stock by entities affiliated with Silver Lake to Morgan Stanley as sole underwriter of the offering.

The offering is expected to close Sept. 9, subject to customary closing conditions. The selling security holders, SLP IV Mustang Holdings and SLP IV Mustang Holdings, will receive all of the proceeds from the offering. Motorola Solutions is not selling any shares and will not receive any proceeds from the offering.

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