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Questions & Answers about Bibliotheca ITG Merger

Press Release: [April 7, 2011]

Copyright (c) 2011 Bibliotheca

Abstract: Integrated Technology Group (ITG), currently a division of Vernon Library Supplies, Inc., a Georgia corporation, and Bibliotheca Inc., a Pennsylvania corporation that is wholly owned by Bibliotheca AG, a Swiss corporation, are merging to create a single company called Bibliotheca ITG, LLC, incorporated in the state of Delaware and backed by One Equity Partners (OEP), a division of JPMorgan Chase & Co.


Who exactly are the players involved and what are they doing?

Integrated Technology Group (ITG), currently a division of Vernon Library Supplies, Inc., a Georgia corporation, and Bibliotheca Inc., a Pennsylvania corporation that is wholly owned by Bibliotheca AG, a Swiss corporation, are merging to create a single company called Bibliotheca ITG, LLC, incorporated in the state of Delaware and backed by One Equity Partners (OEP), a division of JPMorgan Chase & Co.

Why are the companies merging?

By bringing together two successful companies with tried and proven track records, strong customer bases, and similar product and service offerings, Bibliotheca ITG will be a leading company in the field of library self-checkout, RFID, AMH and security industry. Bibliotheca ITG will be positioned more strongly than either company on its own to create and deliver the leading-edge solutions needed by libraries and consortia. This merger will also allow Bibliotheca ITG, through its increased buying power and the consolidation of overhead costs, to offer competitive pricing to go along with superior support and service to our customers.

Is this a merger of equals?

Very much so. ITG has a larger customer base and overall operation in North America than does Bibliotheca. On the other hand, Bibliotheca AG headquartered in Switzerland, is active in many countries throughout the world where ITG is unknown. It is natural, therefore, for the headquarters of Bibliotheca ITG to be based in Atlanta, ITG's home town. And it's natural that for the software and hardware development teams of both companies to remain in place to take advantage of a world perspective as well as a North American perspective.

How will the merger benefit Bibliotheca and ITG customers?

Through this merger, Bibliotheca and ITG will be in a better, stronger position to develop and deliver products and services for our customers. We will be able to take the best of both companies and leverage it for the benefit of our combined customer base. With a larger R&D staff, installation and support staff, and sales staff, more people will be dedicated to a single purpose ensuring the success of our library customers.

We recognize that loyal customers of both companies have developed wonderful working relationships with respective staffs, and we will seek to complete the merger in a way that is least disruptive to our customers who work day-to-day with our support, project management and sales teams.

What is the significance of One Equity Partners' backing?

The backing of One Equity Partners, a division of JPMorgan Chase & Co., ensures that the new company will have the resources necessary to invest in the innovative technology that will serve libraries for many years to come. The investors are not focused on generating short-term returns; they believe and have invested in the long term prospects of a joint organization.

How and when will this merger take place?

In the first step of the merger, scheduled to take place in the coming weeks, all assets that Vernon Library Supplies, Inc. holds in ITG will be rolled into the new company, Bibliotheca ITG, LLC. At that same time, Bibliotheca's U.S. operations will begin operating under the Bibliotheca ITG umbrella. In the last quarter of 2011, the companies will not only be operationally merged, but legally as well.

Where will the company's offices be located?

Bibliotheca ITG's headquarters will be located in ITG's current offices in Atlanta. Bibliotheca U.S. current headquarters in Huntsville, AL will remain open until the last quarter of 2011.

What will be Bibliotheca ITG's management structure?

Shai Robkin, ITG's President and CEO, will become the Managing Director of Bibliotheca ITG.

Lamar Jackson, director of Biblotheca's U.S. operations, will be Bibliotheca ITG's Director of Sales.

Steve Mackey (Bibliotheca) will serve as V.P. of Sales in the West while continuing to work directly with libraries in Colorado and California.

Ken Evans (ITG) becomes V.P. of Sales in the East.

Darin Currie, currently General Manager of Bibliotheca Canada, will maintain his responsibilities for Bibliotheca ITG in Canada.

Other vice president positions will be filled by ITG's current management staff: Jeff Carey, V.P. of Finance; Craig Chandler, V.P. of Operations; Scott Hackstadt, V.P. of Technology; and Amy Thropp, V.P. of Customer Care.

Bibliotheca ITG management will be working closely with their Bibliotheca counterparts in Switzerland.

What will be the relationship between Bibliotheca ITG and Bibliotheca AG, the Swiss company?

Bibliotheca's R&D department in Switzerland, which focuses on the common challenges that libraries face worldwide, will be working closely with Bibliotheca ITG's software and hardware engineers, whose focus has been on the North American library market. As a result, libraries in North America will enjoy ongoing product development that will take what works best in libraries in other parts of the world and refine it specifically for the U.S. and Canadian environments.

Will customer contracts be affected by the merger?

No. Existing contracts with customers will remain binding legal documents. In just a few weeks, ITG contracts will be assigned to Bibliotheca ITG, LLC. In the fourth quarter of the year, Bibliotheca, Inc. U.S. contracts will be rolled into Bibliotheca ITG, LLC.

Will Canadian customers be affected differently from U.S. customers?

Bibliotheca's current Canadian customers will continue to do business with Bibliotheca RFID Library Systems, Inc., a Canadian company; there will be no need to change or assign contracts to a new company. New Bibliotheca ITG contracts with Canadian customers will be made with that corporation on behalf of Bibliotheca ITG.

ITG's contractual responsibilities to current Canadian customers' will be assigned to the new corporation, Bibliotheca ITG, LLC.

ITG's Canadian customers will, however, enjoy the benefits that come with being able to work directly with the company's Canadian office in Ottawa.

All Canadian customers, be they existing Bibliotheca customers, existing ITG customers, or future Bibliotheca ITG customers will have more products and services available to them, delivered from both U.S. and Canadian offices.

What about customers currently negotiating contracts with either Bibliotheca or ITG?

Customers can be certain that their contracts will be honored in full by the new company according to the terms and conditions specified in those contracts.

Who should customers contact going forward for customer service and support?

Into the fourth quarter of 2011, customers will be able to reach the company through the existing phone numbers, emails and web sites of both Bibliotheca and ITG. A single web site, Bibliotheca-ITG.com has already been created and the phone systems have been integrated. From the customer's point-of-view, there should be no operational disruption whatsoever. If and when organizational changes take place, ample notice and details will be provided to customers to ensure that their needs are met without interruption.

Is there any reason to believe that shipment of products or the implementation of my library's project will be delayed as the result of this merger?

No. And as a result of the merger, larger product inventories will be maintained in the U.S. than ever before.

Will my library continue to work with the same account manager?

For the most part yes. Changes in account manager territories will be made with the intention of creating as little disruption as possible. Where there will be a change, your old and new account manager will be contacting you personally and for a period of six months, your old account manager will be available to serve you in addition to your new account manager.

Because everyone involved in sales at Bibliotheca and ITG will move over to Bibliotheca ITG, there will be more staff available to consult with libraries than ever before. This is particularly important given the increased number of products, services and options that will be available to libraries in North America.

Will my library continue to work with the same project manager?

Yes.

Bibliotheca until now has focused almost exclusively on RFID technology while ITG has offered libraries RFID, EM and RFID/EM hybrid solutions. Will EM and RFID/EM hybrid security, self-checkout and AMH products be offered by Bibliotheca ITG?

Yes.

What about the Bibliotheca and ITG product lines? What products will be supported going forward?

All products currently offered by Bibliotheca and ITG will continue to be supported and developed.

Because both companies are focused on library RFID applications, there are obviously a number of products that serve identical or similar functions. However, the fact that both companies are fully committed to technology standards and have built their RFID product platforms around the same tag standards and the same hardware manufacturers will allow customers to choose between different approaches, each with their own advantages.

Eventually, the company looks to offer the features of all products based on a single fully integrated platform. We know that not all libraries are alike and people, be they library staff or patrons, respond differently to different approaches.

Bibliotheca ITG will be able to provide more options and features to meet different needs than any other company in the world.

Will a library have to pay more in order to ensure that their systems can enjoy the benefits of the additional features and functionalities that will be offered as a result of the merger?

Libraries with a current support and maintenance contract will not have to pay for upgrades in functionality of their core products as long as their existing hardware supports it. This means, for example, that a software enhancement of self-checkout software that comes as a result of combining the development talents of the R&D teams will be provided to customers at no additional charge.

Of course, customers will need to pay for new products and optional features for which the companies normally charge.

Why should prospective customers consider buying Bibliotheca ITG products and services while merger activity is taking place?

This merger makes Bibliotheca ITG the most dependable long-term self-checkout, RFID, security, and AMH company in North America, offering the best technology, the richest set of functionality, and the most talented professionals to support our customers.

This merger makes the company stronger and safer to do business with as we now have an even greater ability to embrace and exploit new technologies as they develop. In the final analysis, while the specific products and features that exist today are important, more important is the partnership that libraries establish with a vendor that is committed to libraries and libraries only for the long haul.

With the combined strengths of both the Bibliotheca and ITG product lines and the fact that there will be no disruption in sales and service, potential customers will have richer choices than ever before from a company exclusively dedicated to the library technology industry.

Will customers get to choose between Bibliotheca and ITG products?

Regardless of the product chosen, customers can rely on Bibliotheca ITG's commitment to both support and continued development of that product. Bibliotheca ITG account managers will consult with library staff and discuss in detail the unique advantages of each product. Depending on the customer's needs and specific circumstances, the library's account manager may recommend one or the other. Experience has shown, however, that despite a customer's best efforts to learn about a product and its features, until it is actually working in the library, there is no certainty that the best solution has been selected for a particular library, its staff and its patrons. Because, for many solutions, Bibliotheca and ITG software are designed to work with the same hardware, libraries will often have the option of switching between the two.

Up until now, libraries have had the option of purchasing ITG products through Polaris and SirsiDynix. Will that option continue to exist for Bibliotheca ITG?

Yes. ITG, as part of its commitment to "playing well with others," has been the only company to maintain strategic partnerships with both SirsiDynix and Polaris. These partnerships have served library customers well in the past and will continue to serve them in the future under Bibliotheca ITG.

Bibliotheca and ITG were already among the top vendors of RFID systems. Will this merger result in a less competitive library RFID market and higher prices?

Even as the result of merging two strong market players, Bibliotheca ITG will not come close to having a monopoly on library technology.

There are currently numerous active competitors in this market and it seems like new ones are entering it every day. This merger will allow Bibliotheca ITG, through its increased buying power and consolidation of overhead costs to offer not only the best and widest product selection but also highly competitive pricing.

If you have other questions or concerns, please feel free to contact us, we would be happy to hear from you.

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Publication Year:2011
Type of Material:Press Release
Language English
Issue:April 7, 2011
Publisher:Bibliotheca
Company: Bibliotheca
Subject: Mergers and acquisitions
Record Number:15597
Last Update:2012-12-29 14:06:47
Date Created:2011-04-10 15:01:35