VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 04/24/13 -- Working Opportunity Fund (EVCC) Ltd. (the "Fund") is pleased to report that CA Technologies has announced it has signed a definitive agreement to acquire Layer 7 Technologies Inc. ("Layer 7"), a leading provider of Application Programming Interface (API) management and security. The Fund also reports the extension of the closure of Venture Series sales and redemptions until May 31, 2013 to allow time for the Layer 7 sale transaction to conclude.
The Layer 7 sale transaction was referred to as one of the Portfolio Developments reported in November and December 2012 news releases issued by the Fund. Layer 7 represents the largest portfolio position of the Fund's Venture Series. The Commercialization Series also has a position in Layer 7 and will participate in this exit. The Fund first invested in 2003 when Layer 7 had just seven employees and zero revenue. Today the company employs approximately 165 employees and has customers around the world. The Fund led the first institutional round of financing with participation from partner BDC Venture Capital and Shoreline Ventures.
The Fund believes that the Layer 7 transaction, together with the other Portfolio Development reported in November and December 2012, could result in an increase, in aggregate, of approximately 20% in the Fund's Venture Series share values. A portion of this increase has already been recognized in valuation adjustments made to date. Based on the proposed terms of the transaction, a further gain would be recognized upon closing of the transaction.
The closing of the Layer 7 transaction is unlikely to complete before April 30, 2013. Given the potential impact of the transaction on the Fund's liquidity and net asset value, the Board of Directors of the Fund has determined that it is in the best interests of the Fund's shareholders to extend the closure of sales and redemptions of Venture Series shares to allow time for the Layer 7 transaction to close. It is expected that redemptions will be closed until May 31, 2013, as permitted under the Fund's Articles, although the Board may elect to extend the closure or resume sales and redemptions at an earlier date if the transaction closes prior to May 31, 2013.
The Fund continues to experience significant liquidity pressure due to constrained exit markets and a challenging capital raising climate. Extending the closure of Venture Series sales and redemptions in December 2012 allowed further time for negotiations surrounding the Layer 7 transaction to progress, which was considered prudent given the potential impact of the transaction on Venture Series share values and the liquidity pressure affecting the Fund. These same factors continue to inform the Board's decision on the extension of the closure of the Venture Series sales and redemptions to May 31, 2013.
With the extension of the closure of Venture Series share sales, shareholders with switch rights still may not switch one series of Venture Series shares for another. The extension of the closure affects only new purchases, switches and redemptions of the Fund's Venture Series shares and does not affect the Fund's Commercialization Shares.
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