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Prysmian buying General Cable
Posted on Monday, 04 December 2017 14:10
Milan-headquartered Prysmian is set to acquire US current-carrying wires and cables manufacturer General Cable in an all-cash deal worth an estimated USD 3.00 billion.
The bid of USD 30.00 per share represents a premium of 5.3 per cent over the closing price of USD 28.50 on 1st December 2017, the last trading day prior to the announcement.
Completion is expected in the third quarter of 2018; in the first year following this, earnings are anticipated to increase between 10.0 per cent and 12.0 per cent.
The board-approved transaction is subject to customary closing conditions, including approvals from shareholders and the relevant regulatory bodies.
New debt will be used to finance the takeover, along with existing cash and credit lines.
Prysmian, which manufactures both energy transmission and fibre optic cables, is also planning a rights issue valued at a maximum of EUR 500.00 million.
Kentucky-based General Cable was established in 1927 and is listed on the New York Stock Exchange.
For the nine months ending 29th September 2017, it recorded a net loss of USD 70.50 million, sliding from the USD 10.20 million profit reported for the corresponding timeframe in 2016.
The decline can be attributed to asset sales and restructuring, including the recent sale of its business in China to Meizda Investments on the 26th September 2017.
Italian Stock Exchange-listed Prysmian has 21,000 employees in 50 countries.
For the nine months ending 30th September 2017, it reported earnings before interest, taxes, depreciation and amortisation (EBITDA) of EUR 512.00 million, up from the EUR 488.00 million posted for the same period last year.
Chief executive Valerio Battista said the acquisition will enhance the buyer’s position in the sector “by increasing our presence in North America and expanding our footprint in Europe and South America”.
© Zephus Ltd