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Kaydon Corporation (NYSE: KDN) (“Kaydon”) and AB SKF (OMX: SKF B) (“SKF”) announced today that they signed a definitive agreement under which SKF will acquire Kaydon for $35.50 per share in an all-cash transaction that values Kaydon at approximately $1.25 billion, including debt (the “Transaction”).
The purchase price represents a 22% premium to Kaydon’s closing stock price on September 4, 2013 and a 21% premium to Kaydon’s 30-day volume weighted average stock price. The implied total enterprise value of $1.25 billion represents a multiple of 12.7 times Kaydon's LTM Adjusted EBITDA ($98 million as of June 29, 2013).
James O’Leary, Chairman and Chief Executive Officer of Kaydon, commented, "Our Board believes that the proposed transaction represents a compelling value for our shareholders. We believe that this transaction represents an excellent strategic fit for Kaydon that will allow our market leading businesses to accelerate their growth strategies by joining forces with SKF, a global industry leader. Since 2009, we have repositioned our businesses to take advantage of well defined opportunities beyond purely cyclical drivers while maintaining a strong focus on maximizing shareholder value. This was evidenced by last year’s $10.50 special dividend and our consistent focus on maximizing cash returns to our shareholders. I believe this is the right time for this transaction and SKF is the right partner to take our high quality portfolio of businesses to their next level of performance."
Tom Johnstone, SKF President and Chief Executive Officer, stated, “We have followed the development of Kaydon for a long time. They have a strong product portfolio, strong management and a solid financial performance and I am delighted that they will soon be part of the SKF Group. The complementary nature of their products and technologies, their geographical and customer presence and their manufacturing footprint will enable us to even better serve our customers and distributors in the industrial market worldwide.”