Prysmian Group to acquire General Cable in $3 billion deal
The transaction values General Cable at approximately $3 billion, including debt and certain other General Cable liabilities, and represents a premium of approximately 81% to the General Cable closing price of $16.55 per share on July 14, 2017, the last day of trading before General Cable announced its review of strategic alternatives.
The transaction, which has been unanimously approved by each company’s board of directors and recommended to its shareholders by General Cable’s board of directors, is expected to close by the third quarter of 2018, subject to the approval of General Cable’s shareholders representing at least a majority of the outstanding shares, regulatory approvals, and other customary conditions.
Based on pro forma aggregated results for the twelve months ended September 30, 2017, the combined group would have had sales of over €11 billion and adjusted EBITDA of approximately €930 million. The combined group will be present in more than 50 countries with approximately 31,000 employees.
Prysmian expects the combined group to generate run-rate pre-tax cost synergies of approximately €150 million within five years following closing mainly from procurement, overhead costs savings and manufacturing footprint optimization. One-off integration costs are estimated at approximately €220 million.
The transaction is expected to generate EPS accretion in the range of 10-12% for Prysmian shareholders already within the first year following closing (excluding cost synergies and before related implementation costs). ■