The deal will see Prysmian, the world's biggest maker of industrial cables, pay $30 a share for General Cable, a price that represents a 37.6% premium to the stock's close on Friday, Dec. 1, of $21.80 and is more than 80% north of the July 14 level of $16.55, when the Highland Heights, Kentucky-based group announced a strategic review that ended with a decision for focus on its core business. The deal would also include General Cable's debts.
General Cable was trading at $29.25 shortly after markets opened on Monday.
"This combination is an ideal strategic fit and ensures we are well-positioned to meet the future opportunities and challenges in the dynamic and evolving wire and cable industry," said CEO Mike McDonnell. "Together, we will be able to deliver a robust portfolio of products and services and new product innovation across the full breadth of the wire and cable industry globally."
"Importantly, Prysmian and General Cable have a shared vision and highly compatible cultures founded on similar values," he added.
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General Cable shareholders will need to approve the deal, however, and the potential takeover could attract interest from rivals such as France's Nexans SA (NEXNY) and Denmark's NKT A/S.
Prysmian shares were little-changed in mid-morning trading in Milan at €28.48 each against a 0.95% gain for the FTSE-MIB benchmark.
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