By Angela McDaniels
Seattle, Oct. 8 - United Industrial Corp. said it signed a definitive agreement to be acquired by Textron Inc. in a deal valued at roughly $1.1 billion.
Under the agreement, Textron will acquire all outstanding shares of United Industrial common stock for $81 per share by way of a tender offer. A Textron subsidiary will then be merged into United Industrial, with United Industrial surviving the merger as a wholly owned subsidiary of Textron.
The tender offer is expected to begin on Oct. 16, and the acquisition is slated to close during the fourth quarter.
United Industrial operates through its subsidiary, AAI Corp. AAI will become part of Textron's Bell segment, with the majority of the business operating within Textron Systems Corp.
The boards of directors of both companies have approved the transaction.
Two directors of United Industrial - Warren G. Lichtenstein and Glenn M. Kassan - and investor Steel Partners II, LP have agreed to tender their shares. The directors and Steel Partners collectively own 2,010,950 outstanding shares.
"Overall, our products, capabilities and culture are tightly aligned with Textron's," United Industrial president and chief executive officer Frederick M. Strader said in a news release.
"We will immediately benefit from Textron's world-class business improvement and talent development processes, among others. We also serve many of the same customers and will be able to combine our expertise in government affairs, sales and market development."
Textron Systems president Frank Tempest added, "As with our recent acquisition of Overwatch Systems, AAI's products complement our existing portfolio and provide an essential building block for our precision engagement strategy. AAI will enable us to deliver broader and more integrated solutions to our customers."
United Industrial is based in Hunt Valley, Md., and provides aerospace and defense systems through subsidiary AAI.
Providence, R.I.-based Textron has business in the aircraft, industrial and finance industries.
| Acquirer: | Textron Inc.
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| Target: | United Industrial Corp.
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| Price per share: | $81.00
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| Transaction total: | $1.1 billion
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| Announcement date: | Oct. 8
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| Expected closing: | Fourth quarter of 2007
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| Stock price for target: | NYSE: UIC; $75.62 on Oct. 5
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