* Offer at 9 pct premium to Friday close
* EnergySolutions can seek new offers through Feb. 6
* Shares up as much as 11 pct
By Swetha Gopinath
Jan 7 EnergySolutions Inc agreed to be
taken private by investment firm Energy Capital Partners for
$338.5 million, two months after the nuclear waste management
company said it would have to sell assets to cut its debt.
The deal, which has an enterprise value of $1.1 billion,
will help EnergySolutions expand its decommissioning and
The company's debt is more than double its market value of
about $310 million, and high interest costs have hindered its
ability to invest in its nuclear plant decommissioning business.
The decommissioning business is expected to see growth in
the coming years as Germany and Japan have announced plans to
retire most of their nuclear plants.
The private equity firm is offering $3.75 per share, or a 9
percent premium to EnergySolutions' Friday close.
The stock was up 8 percent at $3.72 in afternoon trading on
"The price they are offering is low," said Imperial Capital
analyst Andrew Casella. "Somebody may look at that and say we
should come in with a superior offer."
EnergySolutions said it intends to actively solicit offers
from third parties through Feb. 6.
Likely contenders are Fluor Corp, URS Corp
or strategic investors, Casella said.
"The company has a unique set of assets, it is definitely a
growth story going forward," said Casella, who has a price
target of $4.75 on the stock.
Intrinsic valuation on Thomson Reuters StarMine suggests
that EnergySolutions' stock should be trading around $4.58.
StarMine's models take into account analyst estimates for
growth, usually over five years, and then chart the typical
growth trajectory of companies over a longer period of time.
EnergySolutions provides services such as decontamination,
spent-fuel handling and waste disposal to customers including
Duke Energy Corp and Exelon Corp.
Energy Capital, whose bid is backed by Morgan Stanley, said
it plans to operate the company as a standalone business with
the current management in place.
Goldman Sachs is the financial adviser to EnergySolutions.