Iron Mountain Adds Cash to Recall Bid After Stock Shrivels

This article was updated from June 8 to correct the name of Iron Mountain President and CEO William Meaney.

NEW YORK (The Deal) -- Boston's Iron Mountain  (IRM) has sweetened its bid for Australia's Recall Holdings Ltd. for a second time, adding cash to give the offer an enterprise value of A$3.4 billion (or $2.6 billion). That price remains below the companies' original agreement, however, following a sharp slide in the bidder's shares.

Under the terms of the revised deal, Iron Mountain will offer 0.1722 of a share and 50 cents in cash for each Recall share. The offer equates to $6.12 a share, or A$2.5 billion for the target's equity, based on Iron Mountain's closing price of $32.65 on Friday, June 5.

Iron Mountain, a documents-storage business, was cajoled back to the negotiating table after its shares slid almost 10% since the end of April when it reached an agreement to buy Recall. Despite the added cash, the new offer remains lower than the implied value of Iron Mountain's earlier bid. That offer of 0.1722 of a share had been worth $6.24 per Recall share based on Iron Mountain's April 28 closing price of $36.24.

Iron Mountain made an initial bid of A$7 per share or A$2.2 billion for Recall in December of last year. That offer was rejected as too low.

"Our due diligence identified the opportunity to for increased synergies and savings ... which allows us to distribute a portion of those savings to Recall shareholders," Iron Mountain's President and CEO William Meaney, said Monday in a statement that didn't mention his company's slide in valuation.

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