By Lisa Kerner
Charlotte, N.C., Feb. 2 - Insituform Technologies, Inc. announced an agreement to acquire Corrpro Cos., Inc. for approximately $1.44 per share.
Total estimated enterprise value of the transaction is approximately $91 million.
The per-share price is subject to reduction if Corrpro's debt or transaction expenses exceed certain levels. Insituform said the per-share price could increase up to $0.03 per share if certain diligence items are resolved prior to the transaction's closing.
Corrpro's board of directors approved the deal, which remains subject to debt financing and shareholder approval.
The merger agreement provides termination rights for both companies. Corrpro would pay a $5 million termination fee to Insituform under specified circumstances. Insituform would pay a reverse termination fee of $3 million to Corrpro under certain terms of the agreement, a form 8-K filed with the Securities and Exchange Commission said.
Insituform also announced that it is buying privately held Bayou Cos., LLC, a New Iberia, La., service provider to the oil and natural gas industries, for $125 million.
According to Insituform, the Corrpro and Bayou transactions will be financed with debt and through a public equity offering that was expected to be launched on Monday.
Insituform said it expects to close both acquisitions by March 31.
William Larkin, Corrpro's president and chief executive officer, said his company's corrosion-protection business is an "excellent complement" to Insituform's energy and mining and water businesses.
"Whether it is through a pipe lining solution offered by Insituform, a coating solution offered by Bayou or a cathodic protection system offered by Corrpro, we will be able to provide the appropriate solution for almost every customer," Insituform president and CEO Joseph Burgess said in a company news release.
Corrpro, based in Medina, Ohio, provides corrosion protection and pipeline maintenance services to the energy and water infrastructure industries. The company was advised on the proposed transaction by Houlihan Lokey.
Merrill Lynch & Co. advised Insituform. The Chesterfield, Mo.-based company provides proprietary trenchless technologies to rehabilitate, replace, maintain and install underground pipes.
| Acquirer: | Insituform Technologies, Inc.
|
| Target: | Corrpro Cos., Inc.
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| Announcement date: | Feb. 2
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| Transaction total: | $91 million
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| Price per share: | Approximately $1.44
|
| Termination fee: | $5 million
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| Expected closing: | March 31, 2009
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| Stock price of target: | Pink Sheets: CRRP: $0.43 on Jan. 30
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