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.
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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