InterVideo Inc. Announces Intention to Purchase Controlling Interest in Ulead Systems
Posted Mar 20, 2005

InterVideo, Inc., a provider of DVD software, has announced that subsequent to a previous purchase of 18.5 percent, it has extended a tender offer to purchase an additional 30.1 to 65 percent of the issued shares of Ulead Systems, Inc., a developer of video, imaging, and DVD authoring software. The all-cash tender offer will be made at 30 NT (US$0.98) per share of Ulead common stock. Assuming the successful completion of the tender offer, the transaction will be valued at between US$23 and US$49 million. The deal is expected to be accretive to InterVideo's 2005 earnings based on InterVideo's current understanding of Ulead's business.

Upon completion of the tender offer, InterVideo will own between 50.1 and 85 percent of the issued shares of Ulead. These figures include the 18.5 percent of Ulead's issued shares currently owned by InterVideo, the shares to be purchased in the tender offer and an additional 1.5% of Ulead's shares to be purchased outside of the tender offer. InterVideo has entered into stock tender agreements with several Ulead shareholders pursuant to which the shareholders have agreed to sell a minimum of 22.5 percent of Ulead's issued shares in the tender offer. The tender offer is scheduled to expire on April 13, 2005.

InterVideo believes that its investment in Ulead will strengthen InterVideo's technology offering and allow the company to provide a more comprehensive digital media solution to both retail and OEM customers. Ulead's strengths in professional DVD authoring, video editing, and still image processing complement InterVideo's tools and provide enhanced opportunities for addressing emerging and rapidly growing markets including multimedia home networking, high-definition and Blu-ray DVD, and multimedia mobile phones, according to a March 14 release from InterVideo. Upon completion of the tender offer, InterVideo and Ulead plan to commence the integration of products and technologies of the two companies.