In a move to expand its base in the US market, Swiss conglomerate ABB on Tuesday said it will acquire electric motor manufacturer Baldor Electric Company for $4.2 billion, including $1.1 billion of net debt.
In a press statement, ABB said it, "will acquire Baldor in an all-cash transaction valued at approximately $4.2 billion, including $1.1 billion of net debt."
Under the terms of the agreement, ABB will commence a tender offer to purchase all of US-based company Baldor's shares for $63.50 per share in cash. The transaction represents a 41 per cent premium to Baldor's closing stock price on Nov 29, 2010.
Subject to regulatory approvals, the deal is expected to close in the first quarter of 2011.
The transaction will substantially improve ABB's access to the industrial customer base in North America and would also allow Baldor to take advantage of the Swiss company's global distribution.
Baldor's product range and regional scope are highly complementary to ours and give both companies significant opportunities to deliver greater value to our customers," ABB CEO Joe Hogan said.
Baldor, a leading supplier in the large North American industrial motors industry, offers a broad range of mechanical power transmission products such as mounted bearings, enclosed gearing and couplings - used primarily in process industries - as well as drives and generators.
Baldor employs about 7,000 people. It reported a 30 per cent jump in operating profit to $184 million in first nine months of 2010 from the year-ago period, and a revenue of $1.29 billion in the period under review, a growth of 11 per cent from year-earlier
Source: www.economictimes.indiatimes.com
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Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
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