3M and Ceradyne, Inc. announced today that they have entered into a definitive agreement for 3M’s acquisition of Ceradyne, Inc. for $35.00 per share. The proposed transaction has an aggregate value of approximately $860 million, or approximately $670 million net of cash,cash equivalents, short-term investments and debt acquired.
The agreement provides for a subsidiary of 3M to commence a tender offer to purchase all outstanding shares of Ceradyne within ten business days. The Board of Directors of Ceradyne has unanimously recommended that the stockholders of Ceradyne accept the offer. The offer will be subject to the tender of a majority of Ceradyne’s shares and to certain other customary closing conditions. The transaction is expected to close during the fourth quarter of this year.
Headquartered in Costa Mesa, Calif., with operations in the U.S., Canada, China and Germany, Ceradyne has annual revenue of approximately $500 million. Ceradyne is a worldwide leader in the development and production of advanced technical ceramics for demanding applications in the automotive, oil and gas, solar, industrial, electronics and defense industries. The unique characteristics of advanced technical ceramics offer significant advantages over traditional materials such as metals and plastics.
The combination of Ceradyne and 3M will enable new technologies and innovation for uniquely tailored materials requiring advanced ceramics. Ceradyne will join the 3M Energy and Advanced Materials Division within 3M’s Industrial and transportation Business. The 3M Energy and Advanced Materials Division provides valued materials for lightweight solutions and materials for performance in harsh environments to customers in a broad array of growth industries.
3M Industrial and Transportation Business Executive Vice President Chris Holmes said, “Ceradyne is a strong company with a great reputation, world-class technology in advanced ceramics, and leadership positions in the markets it serves.
Ceradyne is an excellent complement to our existing businesses in transportation, energy markets and defense. By joining 3M, Ceradyne associates will have the opportunity to use the power of 3M’s global reach, culture of commercializing new products and operational discipline to accelerate this platform in serving our customers with highly valued solutions.”
“3M is renowned for its innovation, its R&D and its global reach,” said Joel Moskowitz, CEO, Ceradyne, Inc. “This is a great fit and I know that advanced ceramics technologies have a tremendous future within 3M and can contribute to the development of unique solutions for many demanding applications.”
On a GAAP reported basis, 3M estimates the acquisition to be $0.05 dilutive to earnings in the first 12 months following completion of the transaction. Excluding purchase accounting adjustments and anticipated integration expenses, 3M
estimates the acquisition to be $0.01 accretive to earnings over the same period.
Credit Suisse acted as exclusive financial advisor to 3M. Citibank acted as financial advisor to Ceradyne.
Source: http://www.3m.com/