The engineered products manufacturer,
Gardner Denver Inc.
) announced that it has entered into a definitive agreement to be
sold to a global investment firm,
Kohlberg Kravis Roberts & Co. L.P.
) for $3.9 billion. Per the agreement, Kohlberg will acquire
Gardner for $76.0 per share in cash.
The merger, which is approved by the board of directors of
Gardner, however, is subject to the approval of its shareholders.
The merger is expected to take effect in the third quarter of
Gardner began considering strategic alternatives in late
October last year, which also included a possibility of sale. The
agreed per share price of merger corresponds to a premium of 39%
to Gardner's share price on Oct 24, 2012.
This merger seems to fit well with the business strategies of
Kohlberg, since it will increase the investment firm's market
presence as well as boost its revenues. Gardner's CEO claims that
the merger will prove to be beneficial for its shareholders as
Kohlberg has an impressive track record of growing the businesses
that its acquires.
Goldman Sachs Group Inc.
) acted as the financial adviser to Gardner while UBS Securities
LLC and Simmons & Company International acted as the
financial advisors for Kohlberg.
Last month, Gardner reported its results for fourth quarter
2012, with earnings per share as well as revenue beating the
Zacks Consensus Estimate. However, it missed the top line as well
as bottom line compared with the year ago results. The pump
maker's market has so far faced many competitions amid a historic
boom in natural gas production while Gardner has focused on
boosting its margins through measures such as restructuring its
Gardner currently holds a Zacks Rank #2 (Buy). Another stock
worth a look in the industry is
EnPro Industries Inc.
), carrying a Zacks Rank #1 (Strong Buy).
GARDNER DENVER (GDI): Free Stock Analysis
GOLDMAN SACHS (GS): Free Stock Analysis
KKR & CO LP (KKR): Free Stock Analysis
ENPRO INDUS INC (NPO): Free Stock Analysis
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