Imation Announces Divestiture of Memorex Brand

Imation Corp. announced divestitures of its corporate HQs facility in Oakdale, MN for a gross purchase price of $11.5 million and its Memorex trademark and two associated trademark licenses for $9.4 million.

Both sales are consistent with the company’s stated restructuring, wind down process, and liquidation of its legacy business assets.

Previously, on October 14, 2015, Imation acquired substantially all of the equity of Connected Data, Inc., an emerging enterprise, private cloud sync and share company. This acquisition augments Imation’s vision in delivering a comprehensive and secure storage, backup and collaboration ecosystem and creating a valuable standalone disk storage subsidiary.

“We are on track to completing the restructuring of our legacy businesses in Q1 2016, and I am pleased with the integration of Connected Data in our Nexsan business and continued development of the combined product strategy,” remarked Bob Fernander, interim CEO.

In late December 2015, the company also amended its cash investment policy to permit investment activity in public company stock, index funds, mutual funds, and other investment funds that offer attractive returns without compromising liquidity, at all times considering the applicable risks.

The company is actively evaluating options to invest excess cash under its amended cash investment policy. The company would welcome inbound interest directed to the interim CEO from financial advisors and money management firms that are interested in making proposals to assist the company in this endeavor.

Imation’s board and executive team will also continue to work closely with its advisors to drive change within the company and explore strategic alternatives to maximize shareholder value, including, but not limited to, divestitures of its non-core and non-operating assets.

To that end, in August 2015, Imation formed a strategic alternatives committee of its board to work with management and make recommendations to the board regarding the company’s use of its excess capital, and on October 19, 2015, the company announced that it will actively explore new alternative uses for its excess capital.

Fernander will lead the evaluation and deployment of capital in conjunction with the strategic alternatives committee. The committee has been tasked with examining opportunities to deploy Imation’s excess cash and developing initiatives for strategic value creation.

The scope of the acquisition opportunities to be considered may be outside of industries that have comprised Imation’s historical focus, and may be sourced in the private and public markets. The company generally expects to evaluate opportunities where it can acquire businesses that it can actively manage and oversee, but may make investments in opportunities that it will not control.

“We look forward to continuing the transformation of the corporation into an entity poised for sustained growth and equity value creation,” said Joseph A. De Perio, non-executive COB. He is also a senior portfolio manager of Clinton Group, Inc., one of the company’s major shareholders.

Read also:
Imation: Fiscal 3Q13 Financial Results
Sale of Memorex Consumer Electronics and XtremeMac
2013.10.31 | Press Release | [with our comments]