Blount International Inc. (NYSE: BLT) led the bulls in Thursday’s regular trading session on news of a buyout. The company announced that it entered into a definitive agreement to be acquired by affiliates of American Securities and P2 Capital Partners, in an all-cash transaction valued at roughly $855 million, including the assumption of debt.
Under the terms of the proposed transaction, Blount shareholders will receive $10.00 in cash for each share of Blount common stock they hold, representing a premium of 86% to Wednesday’s closing stock price.
The independent members of Blount’s board of directors unanimously approved the transaction.
What makes this merger somewhat unique is a 50-day “go-shop” period that runs through the end of January 2016. The goal of this is to maximize value for Blount shareholders.
24/7 Wall St.Josh Collins, chairman and CEO of Blount, commented on the transaction:
The proposed transaction will deliver immediate value to Blount’s shareholders and we expect it will also provide us with additional flexibility to execute our strategic plan as we continue to navigate the macroeconomic challenges facing our industry. American Securities and P2 Capital Partners each have excellent track records of investing in outstanding businesses for the long-term.
Josh Paulson, partner at P2 Capital Partners, added:
This transaction will enable us to partner with Blount’s proven management team and talented employees to help drive the next wave of product innovation and leadership that has defined Blount for nearly 70 years. We are committed long-term investors, having been a Blount shareholder for several years, and look forward to working closely with Blount as a private company to help it take full advantage of the opportunities that lie ahead.
Blount expects to maintain its corporate headquarters in Portland, Ore., as well as its distribution and sales footprints.
Shares of Blount were trading up over 83% at $9.87 Thursday, with a consensus analyst price target of $7.00 and a 52-week trading range of $5.08 to $17.97.
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