By Lisa Kerner
Charlotte, N.C., Sept. 24 - The boards of directors of Metal Management, Inc. and Sims Group Ltd. agreed to combine the companies to create Sims Metal Management, according to a company news release.
The deal is reportedly valued at $1.6 billion.
Metal Management stockholders will receive 2.05 Sims American Depositary Receipts (ADRs) for each share of Metal Management. The value of the ADRs is roughly 18.2% over the closing price of Metal Management's stock on Sept. 21. Sims shareholders will own about 70% and Metal Management shareholders will own some 30% of the combined company.
The transaction is expected to close in the first quarter of 2008 and a termination fee of up to $25 million is included in the agreement, as stated in a form 8-K filing with the Securities and Exchange Commission.
"Bringing Sims and Metal Management together accelerates both companies' strategic plans and creates a clear global leader with unparalleled infrastructure, talent and financial resources," Metal Management chairman, president and chief executive officer Daniel W. Dienst said in the release.
Sims CEO Jeremy Sutcliffe added that the "combination unites two very similar corporate cultures that share a strong commitment to safety and the environment."
Sims Metal Management will operate at more than 200 locations on four continents, processing and trading more than 15 million tons of metal annually. The metal recycling company will be based in Australia, with offices in New York and Chicago.
The combined board of directors will be comprised of seven existing Sims directors and five existing Metal Management directors, led by chairman of the board Paul Mazoudier. Dienst, Sutcliffe and Sims chief financial officer Ross Cunningham will be executive directors.
Dienst will become group CEO, and Metal Management CFO Robert Larry will become group CFO. Sutcliffe will have responsibility for European and Australasian metal recycling operations and Sims will be responsible for the recycling solutions segment.
Metal Management is a full-service metal recycler based in Chicago. It was advised by CIBC World Markets Corp. and King & Spalding LLP.
Sims is a metal recycler based in Sydney, Australia.
| Acquirer: | Sims Group Ltd.
|
| Target: | Metal Management, Inc.
|
| Price per share: | 2.05 Sims American Depositary Receipts
|
| Transaction total: | $1.6 billion
|
| Termination fee: | Up to $25 million
|
| Announcement date: | Sept. 24
|
| Expected closing: | First quarter 2008
|
| Stock price for target: | NYSE: MM: $9.88 on Sept. 21
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
