Notable Mergers and Acquisitions of the Day 10/17: (ASML)/(CYMI) (XOM) (ZEP) (CME)

• ASML Holding NV (NASDAQ: ASML) and Cymer, Inc. (Nasdaq: CYMI) entered into a definitive agreement under which ASML will acquire all outstanding shares of Cymer in a cash-and-stock transaction currently valued at EUR 1.95 billion.
  
  The transaction, which was unanimously approved by the boards of directors of ASML and Cymer, would entitle each Cymer shareholder to receive US$20.00 in cash and a fixed ratio of 1.1502 ASML ordinary shares per Cymer share. The total price reflects a premium of 61 percent over Cymer's 30-day volume-weighted average price (VWAP) and 52 percent over its 90-day VWAP, using ASML's VWAP for the comparable period ending 16 October 2012.
  
  
  As a result of the transaction, ASML will also acquire Cymer's DUV business. This technology is expected to remain a significant and growing engine of sales and profit and will be well positioned to support and balance customer needs for EUV and immersion multiple patterning. ASML intends to manage Cymer's commercial operations as an independent division based in the United States, and will continue to deliver and service DUV and EUV sources for all customers on an arm's length basis. ASML scanners will continue to interface with light sources from all manufacturers.
  
  The transaction is expected to close in the first half of 2013 and is subject to customary closing conditions, including review by U.S. and international regulators and approval by Cymer's shareholders. Excluding non-cash purchase price accounting adjustments, the transaction is expected to be accretive to ASML's EPS in the second year after closing.
  
  
• ExxonMobil Canada (NYSE: XOM) entered an agreement to acquire Celtic Exploration Ltd.
  
  Under the terms of the agreement, ExxonMobil Canada will acquire 545,000 net acres in the liquids-rich Montney shale, 104,000 net acres in the Duvernay shale and additional acreage in other areas of Alberta.
  
  Shareholders of Celtic Exploration will receive C$24.50 per share and half a share of a newly established company which will hold assets not included in the agreement with ExxonMobil Canada. These assets include acreage in the Inga area in British Columbia, the Grande Cache area in Alberta and interests in oil and gas properties located in Karr, Alberta.
  
  
• Zep Inc. (NYSE: ZEP) has entered into a definitive agreement to purchase all of the assets of Ecolab Vehicle Care, a division of Ecolab Inc. (NYSE: ECL), for approximately $120 million. Sales and adjusted EBITDA for Ecolab’s vehicle care division for the trailing 12 months ending June 30, 2012 were approximately $66 million and $13 million, respectively. Pending regulatory approvals, the purchase is expected to close later this calendar year.
  
  Once approved, the combination of Ecolab’s Vehicle Care division, Zep’s existing North American Sales and Service vehicle wash operations, Niagara and Washtronics will create a new platform, “Zep Vehicle Care,” representing approximately 13% of the Company’s net sales. Zep Vehicle Care – to be based in Minnesota – will be a leading provider of vehicle care products, including soaps, polishes, sealants, wheel and tire treatments and air fresheners to professional car washes, convenience stores, auto detailers, and commercial fleet wash customers. Zep Vehicle Care will access customers through the direct and distribution channels, and will provide car, truck and fleet wash operators high efficacy products for their wash tunnels and facilities as well as retail operations.
  
  Zep Inc. will finance the acquisition using existing debt capacity. The Company will incur acquisition-related costs associated with advisory, legal and other due diligence-related services during its first and second quarters of fiscal 2013. In addition, the Company is subject to a transition services agreement during a period up to 12 months under which Ecolab will continue to provide certain services to the Company. Despite these first year acquisition and transition-related costs, the Company anticipates this transaction will be modestly accretive to earnings in fiscal 2013. Once integration activities are complete, the Company anticipates realizing additional synergies ranging between $1.5 million and $2 million annually.
  
  
• CME Group (NYSE: CME) and the Kansas City Board of Trade, the leading futures market for hard red winter (HRW) wheat, today announced they have signed a definitive agreement under which CME Group will acquire the Kansas City Board of Trade (KCBT).
  
  Under the terms of the transaction, CME Group will pay $126M in cash for KCBT. In addition, KCBT will make a special distribution of excess cash to members concurrent with closing. CME Group has committed to maintain a committee made up of KCBT market participants to advise on HRW wheat contract terms and conditions for at least three years, and to maintain the historic KCBT trading floor in Kansas City for a period of at least six months.
  
  The board of directors of KCBT unanimously approved the transaction, which is expected to close later this year pending approval by KCBT shareholders and regulators, expiration of the applicable Hart-Scott-Rodino waiting period and completion of customary closing conditions.
  
  The addition of HRW wheat upon completion of the transaction will further enhance CME Group's already broad agricultural product offering. HRW wheat is the predominant variety grown in the United States, and is also the leading variety sold through export. Customers around the globe will continue to benefit from access to underlying CBOT and KCBT wheat contracts through the CME Globex electronic trading platform.
  
  KCBT was advised on the transaction by George K. Baum Capital Advisors and the law firm of Husch Blackwell. CME was advised by the law firm of Skadden, Arps, Slate, Meagher & Flom.

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