Italian food-service equipment maker Ali Holding S.r.l. has agreed to acquire rival Welbilt Inc. (WBT) in an all-cash deal, giving the company an enterprise value of $4.8 billion.
Under terms of the deal, Ali Group will pay $24 for each Welbilt share outstanding. Welbilt had about 141.92 million shares outstanding as of May 3. The proposal represents a premium of 3.5% to the Welbilt closing share price on July 2, 2021, the last trading day prior to the July 5 proposal. It also represents a premium of around 11.4% to the implied value of the all-stock transaction with Middleby Corp. as of July 2, and a premium of 53.6% to the closing share price on April 20 the last trading day prior to announcement of the Middleby deal.
The merger agreement has been unanimously approved by the boards of directors of both companies. In addition, Carl Icahn, who owns 7.7% of Welbilt stock, has entered into a support agreement in favor of the transaction.
The transaction is expected to close in early 2022. Welbilt’s shares will no longer trade on the NYS after the deal completes.
Last week, Welbilt announced that its Board of Directors has determined that the proposal from Ali Holding constitutes a “Superior Proposal” compared to its previously announced deal with Middleby Corp. (MIDD).
Meanwhile, American foodservice equipment provider Middleby announced that the company will not increase its offer to acquire Welbilt. Middleby is also entitled to a $110 million termination fee from Welbilt.
In April, Middleby agreed to buy Welbilt for about $2.9 billion or 0.124 Middleby share for each Welbilt stock. However, in May, Ali Group initially offered $23 per share or $3.3 billion in cash for Welbilt, then later sweetened the offer to $24 per share.
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