Melrose PLC to Acquire Elster Group (ELT) in $2.3B Cash Deal

June 29, 2012 7:25 AM EDT Send to a Friend
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Elster Group SE (NYSE: ELT) today announced that it has entered into a definitive agreement with Melrose PLC, pursuant to which a wholly-owned subsidiary of Melrose PLC would offer to acquire all outstanding American Depositary Shares of Elster (ADSs, each of which represents one-fourth of one ordinary share of Elster (Share)), for $20.50 per ADS in cash (the ADS Offer Price) and all Shares for $82.00 per Share in cash, representing an aggregate value for all outstanding ADSs and Shares of approximately $2.3 billion.

The Administrative Board of Elster has unanimously approved the transaction. Elster has been informed by its largest shareholder, Rembrandt Holdings S.A., that Rembrandt has agreed to tender the 17,412,069 Shares owned by it and the 531,025 ADSs owned by its wholly-owned subsidiary (collectively representing approximately 62 percent of the outstanding share capital of Elster) into the offer.

The transaction will be funded by a fully underwritten rights issue by Melrose that is expected to raise approximately 1.2 billion pounds Sterling as well as by an acquisition tranche of 0.25 billion pounds under a new term and revolving credit facility of Melrose.

The closing of the tender offer is conditional, among other things, on holders of Shares and ADSs tendering at least 75 percent of the outstanding share capital of Elster, approval of the acquisition of Elster by the shareholders of Melrose at a general meeting, admission of the Melrose rights issue shares to the premium segment of the UK Financial Services Authority's Official List and to trading on the main market of the London Stock Exchange, and clearances by relevant regulatory authorities. The transaction is expected to close in the third quarter of 2012.


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