Valassis Pays Up for Advo
Valassis will pay $37 for each share of Advo. The company also expects to refinance around $125 million in existing Advo debt.
Advo soared on the news, gaining $11.67, or 48%, to $35.93. The stock had closed Wednesday at $24.26, and during the last year, it has traded between $23.06 and $35.80.
Meanwhile, Valassis was plunging $3.31, or 14.3%, to $19.91, putting it well below its lowest close of the past 52 weeks at $23.09."Together, Valassis and Advo will be well positioned for growth as a more diversified company with complementary capabilities, product offerings and clients," said Alan F. Schultz, Valassis' chairman, president and CEO. "We will have an unsurpassed ability to deliver value and savings to consumers where, when and how they want -- and to do so with advanced analytics and targeting capabilities that maximize advertisers' return on investment." The merged company would expect revenue of about $2.65 billion in 2007. Both boards have approved the deal, and the companies plan to close the transaction in three to four months. The combined company will serve 20,000 advertisers worldwide, including 94 of the top 100 in the U.S.
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