This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Deal: Atlas Copco Acquires Edwards Group for $1.6B

NEW YORK ( TheStreet) -- Swedish industrial group Atlas Copco announced an agreement to acquire British vacuum products maker Edwards Group (EVAC) for an enterprise value of up to $1.6 billion, just 15 months after Edwards' initial public offering on the Nasdaq stock exchange in New York.

The Stockholm-based buyer, which is listed on the Nasdaq OMX exchange in Sweden, will buy Edwards for up to $10.50 a share, including a fixed cash payment of $9.25 a share at closing and an additional payment of up to $1.25 a share depending on Edwards' final revenue and Ebitda figures for 2013.

Edwards, of Crawley, England, has products and services which are integral to a wide range of processes, such as the manufacture of semiconductors and flat panel displays. The company must achieve 2013 revenues between £587.5 million ($919 million) and £650 million and adjusted Ebitda between £113.9 million and £145 million to qualify for the earnout.

Edwards' full year results were significantly lower in 2012 than the previous year. Adjusted EBITDAwas £114 million in 2012, compared with £161 in 2011, while revenues were £595 million, down from £701 million the previous year. In the company's annual report, CEO Jim Gentilcore described this as a "solid performance in a challenging and shifting market environment," and said the company had "negotiated a downturn in the semiconductor market and significantly weaker emerging technology demand."

Depending on the size of the additional payment, the merger price represents a premium of between 11% and 26% to Edwards' 30-day average closing price of $8.33 up to Aug. 16. It is also at a premium to Edwards' IPO price of $8.00 a share in May 2102.

Both companies' boards have recommended the offer, and shareholders representing about 84% of Edwards' shares have agreed to vote in favor of the offer.

The deal is being described as a merger. On completion, a new Vacuum Solutions Division will be formed within the Atlas Copco Compressor Technique business area, with its headquarters in Crawley.

The two companies said their businesses were complementary. Edwards said the deal would help accelerate its growth strategy and provided more opportunities for its employees, while Atlas Copco said the acquisition would offer it an opportunity to expand into a growing business which served industries it already knew well.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
EVAC $10.27 0.79%
AAPL $132.04 1.87%
FB $80.55 1.53%
GOOG $539.79 1.40%
TSLA $247.43 -0.01%

Markets

DOW 18,162.99 +121.45 0.67%
S&P 500 2,123.48 +19.28 0.92%
NASDAQ 5,106.5930 +73.8420 1.47%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs