, the operator of Italy's lottery, agreed to buy
for $35 a share, giving the transaction a value of around $4.65 billion.
Together, Lottomatica and Gtech would have 2005 revenue of $1.9 billion. The combined company will have operations in more than 50 countries and 6,300 employees.
Gtech said Tuesday that the price of $35 a share represents a premium of 15% above its closing price Sept. 9, the last trading day before it said its board would explore strategic alternatives. Investors weren't satisfied with that view, and lately shares of Gtech were lower by 16 cents at $33.34.
The total value of the transaction, including the assumption of Gtech's debt, is about $4.8 billion. Gtech's shares shall be delisted from the
New York Stock Exchange
Gtech, a seller of lottery games and equipment, said the companies should close the transaction in mid-2006. Afterward, Gtech will operate as a separate business unit within the Lottomatica group, which will be based in Rome. Gtech will maintain its headquarters in Rhode Island.
As had been planned, Rosario Bifulco, the chairman and chief executive of Lottomatica, will relinquish his executive roles. W. Bruce Turner, the president and CEO of Gtech, will become CEO of Lottomatica, while maintaining his position at Gtech.
Marco Sala, the current general manager of Lottomatica, will be proposed as the managing director of the company with responsibility for Italian operations. Additionally, Jaymin Patel, Gtech's chief financial officer, will become CFO of Lottomatica. Gtech's other officers and management team are expected to retain their positions.