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The Hackett Group, Inc. Announces $55 Million Dutch Auction Tender Offer

Stocks in this article: HCKT

The Hackett Group, Inc. (NASDAQ: HCKT), a global strategic advisory and operations improvement consulting firm, today announced that it will commence a modified “Dutch auction” tender offer to purchase up to $55 million in value of its common stock par value $0.001 per share (“Common Stock”) on February 22, 2012. This would represent approximately 27 percent of its outstanding common shares at the high end of the pricing range. The Company intends to pay for the share repurchase from its existing cash and cash equivalents balances which were approximately $33 million as of December 30, 2011 and with a new $50 million credit facility.

"The tender offer reflects our continued commitment to enhancing shareholder value and provides an attractive use of our capital given Hackett's strong cash flow and current market valuation," commented Ted A. Fernandez, Chairman and Chief Executive Officer of The Hackett Group. "We are very pleased that our cash balances and new credit facility allow us to return capital to our shareholders while providing continued flexibility to pursue our growth initiatives. We continue to believe significant value exists in our current operations through the execution of our long-term business strategies."

Modified Dutch Auction Tender Offer

Hackett will offer to purchase up to $55 million in value of its Common Stock at a price not greater than $5.00 nor less than $4.25 per share. In accordance with the rules of the Securities and Exchange Commission (“SEC”), Hackett may increase the number of shares of stock accepted for payment in the offer by no more than 2 percent of the outstanding stock without amending or extending the offer. On February 17, 2012, the closing price of Common Stock was $3.89 per share. The tender offer will commence tomorrow, February 22, 2012, and will expire at 5:00 p.m., New York City time, on March 21, 2012, unless extended.

A modified “Dutch auction” tender offer allows stockholders to indicate how much stock and at what price within the range they wish to tender their stock. Based on the number of shares tendered and the prices specified by the tendering stockholders, Hackett will determine the lowest price per share that will enable it to purchase $55 million in value of Common Stock at such price, subject to the terms of the tender offer. All stock purchased in the tender offer will be purchased at the same price, even if the stockholder tendered at a lower price, so in some cases Hackett may purchase stock at a price above the price indicated by the stockholder tendering that stock. If the tender offer is fully subscribed, then $55 million in value of Common Stock at the purchase price determined by Hackett will be purchased (subject to Hackett’s above-referenced ability to increase such numbers of shares), representing approximately 26.9 percent to 31.7 percent of outstanding Common Stock as of February 17, 2012.

If, at the final purchase price, shares representing more than $55 million in value of Common Stock at the applicable purchase price (or such greater number of shares as Hackett may choose to purchase without amending or extending the offer) are properly tendered, not properly withdrawn from and accepted pursuant to the offer to purchase, Hackett will purchase stock tendered at or below that price on a pro rata basis. The tender offer will not be conditioned upon any minimum number of shares being tendered. The tender offer will be, however, subject to certain conditions described in the tender offer documents, which will be distributed to stockholders on February 22, 2012. These documents will also contain tendering instructions and a complete explanation of the tender offer’s terms and conditions.

While Hackett’s Board of Directors has authorized the Company to make the tender offer, neither Hackett nor its Board of Directors make any recommendation to any stockholder as to whether to tender or refrain from tendering any stock or as to the price or prices at which stockholders may choose to tender their stock. Hackett has not authorized any person to make any such recommendation. Stockholders must decide whether to tender their stock and, if so, how much stock to tender and at what price or prices. In doing so, stockholders should carefully evaluate all of the information in the tender offer documents, when available, before making any decision with respect to the tender offer, and should consult their own financial and tax advisors.

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