By Lisa Kerner
Charlotte, N.C., May 3 - SSAB Svenskt Stal AB entered into an agreement to acquire Ipsco Inc. for $160 per share in cash for a total equity value of $7.7 billion.
The transaction, approved by both companies' boards of directors, will be completed by a plan of arrangement under Canadian law requiring approval by 66 2/3% of Ipsco shareholders.
SSAB received commitments for bank financing and intends to pursue a 10 billion Swedish kronor rights offering during 2007.
"This transaction delivers significant value to Ipsco's shareholders," Ipsco president and chief executive officer David Sutherland said in a company news release.
"It also joins Ipsco with a leading player in the global steel industry and reinforces our already solid position as a leading supplier of steel plate and energy tubulars in North America."
SSAB said the deal will result in an immediate and significant accretion to its earnings and cash flow as well as significant strategic and financial benefit to the company.
Ipsco's lead financial adviser was Goldman, Sachs & Co., and RBC Capital Markets was co-adviser.
Greenhill & Co., LLC is acting as lead financial adviser and Handelsbanken Capital Markets is acting as co-financial adviser to SSAB.
Ipsco produces steel products and tubulars in Lisle, Ill.
SSAB is a Stockholm, Sweden-based steel products company.
| Acquirer: | SSAB Svenskt Stal AB
|
| Target: | Ipsco, Inc.
|
| Transaction value: | $7.7 billion
|
| Price per share: | $160
|
| Announcement date: | May 3
|
| Expected closing: | Upon approvals
|
| Stock price for target: | NYSE: IPS; $148.55 on May 2
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