Credit Suisse Investment Banking Pitch Book
CONFIDENTIAL
Overview of Saturn Proposal
Proposal
$35 per Solar share is its "best and final" offer
▸ Saturn is "reasonably confident" it can finance this
offer; however, it is not going to be easy" (i.e..
significant amount of debt and equity to be raised)
Mid-teens IRR
▸
▸ Confirmed that there will be no financing
contingencies/out
Four lead sponsors, including Saturn, and LPs
Saturn is still considering an equity investment of
up to $1.0BN (including LPs)
The three to four other yet to be identified lead
sponsors will need to put in $500MM - $1.0BN;
may have other sponsors co-invest at a later stage
Two to three lead bank financing sources
Saturn's $35.00 proposal implies an equity and
enterprise value of $10.6BN and $10.9BN,
respectively
32.4% premium to current stock price of $26.43
(as of 1/27/05)
Proposal is subject to mutual agreement on equity
rollover between Saturn and Solar management
CREDIT FIRST
SUISSE BOSTON
Assumptions
Solar organic revenue growth of 3.0 % - 3.5%
▸ Iverson organic revenue growth of 4.5% - 5.0%;
margins inline with management estimates
▸ Allen organic revenue growth of 2.0%; margins
declining (lower than management estimates)
► HE/PS organic revenue growth of 6.0%
Leverage of 6.5x FYE 2004 EBITDA
Saturn has identified three areas to potentially
improve profitability; they believe that Solar could
generate $30MM - $40MM of additional operating
cash flow in the next 1-2 years
▸ Lower tax rate
▸ Incremental revenue from training services
▸ Incremental revenue from professional services
2View entire presentation