Indra to issue shares in $324 million takeover offer for Tecnocom
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The logo of Spanish technology company Indra is seen on the top of its headquarters in Alcobendas, outside Madrid, Spain, March 9, 2016. REUTERS/Sergio Perez
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MADRID (Reuters) - Spanish technology and defense company Indra made a takeover offer for information technology company Tecnocom for 4.25 euros per share, valuing it at about 305 million euros ($324 million), excluding treasury stock.
The deal will provide annual cost savings of more than 40 million euros, Indra said. Indra, whose businesses range from electronic voting systems to healthcare services, laid off thousands of staff last year in a move to save up to 200 million euros annually.
It said it would issue new shares to pay for part of the takeover deal. Shares in Indra fell once a regulator trading suspension was lifted, to trade down 1.6 percent. Tecnocom shares jumped 5.8 percent.
The offer, which still must be cleared by Spain's market regulator, is at an 11.5 percent premium to Monday's closing price. Tecnocom had already traded 13 percent higher on Monday.
Analysts welcomed the deal, with broker Haitong saying although the price did not look cheap, significant cost savings and a good fit meant Indra shares were likely to rebound after an initial dip once they opened for trade.
Indra will pay 60 percent of the offer in cash and will issue 12 million new shares, diluting existing share capital by 6 percent, to cover the remaining 40 percent to be paid in equity, Chairman Fernando Abril-Martorell said in a conference call.
Tecnocom shareholders holding 52.7 percent of Indra's capital have subscribed to the offer, Indra said.
(Reporting by Robert Hetz and Paul Day; Editing by Sonya Dowsett and Susan Fenton)
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