By Lisa Kerner
Charlotte, N.C., June 11 - LS Cable Ltd. agreed to acquire Superior Essex Inc. for $45 per share, the companies announced on Wednesday.
Superior Essex confirmed on June 10 that it was in discussions with LS Cable regarding a potential business combination.
The merger is expected to create a wire and cable industry leader with a product portfolio and capabilities in power cable, magnet wire, communications cable and copper rod, an LS Cable news release stated.
LS Cable said the per-share offer price is a 50% premium over the year-to-date closing price of Superior Essex common stock.
Total equity value of the offer is approximately $900 million.
An LS Cable subsidiary expects to begin a cash tender offer on July 1 to purchase all of the outstanding shares of Superior Essex common stock.
Also on July 1, LS Cable will complete its previously announced internal corporate reorganization and change its name to LS Corp.
The acquisition will be completed in a second-step merger following the close of the tender offer on July 31, the release said.
LS Cable noted that it has fully committed financing that it will use in combination with available cash resources and lines of credit to complete the transaction.
Once the merger is complete, Superior Essex will continue to operate under its current name as a wholly owned subsidiary of LS Cable, maintaining its headquarters in Atlanta and its manufacturing and distribution facilities in the United States, Canada, China, France, Germany, Italy, Mexico, Portugal and the United Kingdom.
"This transaction will make LS Cable a strong global competitor at the forefront of the ongoing wire and cable industry consolidation," LS Cable chairman John Koo said in the release.
Superior Essex chief executive officer Stephen Carter said the merger provides fair value to shareholders and will significantly enhance the company's global expansion and product diversification strategy.
The combined company will have pro forma consolidated 2007 revenues of $12.8 billion and will be the third-largest wire and cable manufacturing company in the world, according to the news release.
Macquarie Securities Korea Ltd. and Macquarie Capital (USA) Inc. acted as Korean and U.S. financial advisers to LS Cable.
J.P. Morgan Securities Inc. was the financial adviser to Superior Essex.
In March, LS Cable, a Seoul, South Korea-based cable and wire company, proposed buying Superior Essex for $36 per share.
Superior Essex is an Atlanta-based wire and cable manufacturer.
| Acquirer: | LS Cable Ltd.
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| Target: | Superior Essex Inc.
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| Announcement date: | June 11
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| Transaction total: | $900 million
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| Price per share: | $45.00
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| Expected closing: | July 31 (tender offer)
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| Stock price of target: | Nasdaq: SPSX: $44.10 on June 10
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