UPDATE 2-3M to buy Ceradyne for $860 million
* 3M's largest deal since naming new CEO
* Adds industrial ceramics to 3M product lineup.
* Ceradyne shares soar 43 percent in premarket trading
Oct 1 (Reuters) - 3M Co reached an $860 million deal to buy Ceradyne Inc, a maker of advanced technical ceramics, in what is set to be the diversified U.S. manufacturer's largest acquisition since Inge Thulin took over as chief executive in February.
The offer of $35 per share represents a premium of about 43 percent to Ceradyne's Friday closing of $24.43. The company's shares jumped to $34.98 in premarket trading.
Ceradyne, with about $500 million in annual revenue, sells ceramics used in cars, oil and gas production and other industrial applications. Its products will join 3M's broad lineup of goods ranging from Post-It notes to films used in television screens.
The price tag includes the value of stock options and restricted stock units acquired.
Under terms of the deal, 3M will launch a tender offer to buy all outstanding shares of Ceradyne within 10 business days. Ceradyne's board unanimously recommends shareholders accept the offer.
The deal will be dilutive to 3M's earnings by 5 cents a share in the first 12 months after the transaction closes. Excluding purchase accounting adjustments and anticipated integration expenses, 3M said the acquisition should add a penny per share to earnings over that same period.
Credit Suisse advised 3M and Citibank advised Ceradyne.
Thulin last month told investors he would aim to do fewer, but larger takeovers, than his predecessor George Buckley. 3M is also working on a $550 million arrangement to buy the office products business of Avery-Dennison Corp, though U.S. regulators have raised anti-trust concerns about the tie-up.
- China food scandal spreads, drags in Starbucks, Burger King and McNuggets in Japan |
- U.S. court rulings create new uncertainty over Obamacare
- Israel pounds Gaza despite international peace efforts |
- EU readies possible capital, tech sanctions on Russia
- Train carrying MH17 bodies on final journey reaches Ukraine city |