By Lisa Kerner
Charlotte, N.C., Feb. 5 - The boards of Hanover Compressor Co. and Universal Compression Holdings, Inc. approved a stock-for-stock merger of equals that is expected to close in the third quarter of 2007, according to a company news release.
The Houston-based companies also entered into a definitive merger agreement giving Hanover stockholders 0.325 shares and Universal stockholders 1.0 share of the new company for each of their respective shares.
Based on Feb. 2 closing market prices, the combined, newly formed Houston-based holding company will have an estimated equity market capitalization of $3.8 billion.
Initially Hanover stockholders will own about 53% and Universal stockholders roughly 47% of the new company, the release stated.
Following the merger, Universal chairman, president and chief executive officer Stephen Snider will serve as president and chief executive officer of the new company. Hanover chairman Gordon T. Hall will serve as chairman of the board of the combined company.
"Operating under a new corporate name, we will be able to fully leverage our combined capabilities to provide an enhanced level of customer support and a wider product and service offering to meet the full compression services and production and processing equipment needs of our customers worldwide," Snider said in the release.
Hanover Compressor is a provider of service, fabrication and equipment for oil and natural gas production, processing and transportation applications.
Universal Compression is a natural gas compression services company.
| Acquirer: | Hanover Compressor Co.
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| Acquirer: | Universal Compression Holdings, Inc.
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| Payment per share: | Hanover stockholders 0.325 shares of the combined company
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| Universal stockholders 1.0 share of the combined company
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| Announcement date: | Feb. 5
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| Expected closing: | Third-quarter 2007
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| Stock price for target: | NYSE: HC; $19.40 on Feb. 2
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| Stock price for target: | NYSE: UCO; $61.10 on Feb. 2
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