UPDATE 3-Boskalis to buy Smit in 1.1 bln euro deal
* Offer is 60 euros/share cash
* 44 pct of Smit shares already pledged in favor
* Deal will add to Boskalis's EPS in 2010
* Smit up 6.5 pct, Boskalis down 3 pct
(Recasts with analyst comments, Smit earnings, updates stock price)
AMSTERDAM, Nov 12 (Reuters) - Dutch dredging group Royal Boskalis Westminster NV (BOSN.AS) will buy Smit Internationale NV (SMTNc.AS) for 1.1 billion euros bringing to an end more than a year of on-and-off talks between the companies.
Boskalis, already the world's largest dredger, abandoned a previous takeover attempt for maritime services company Smit late last year in the face of a lack of cooperation from Smit's supervisory board and management. [ID:nL4664741]
But both sides said on Thursday they did not see anything derailing the deal this time around.
Analysts said the change of heart seemed to stem from Boskalis's commitment not to sell off parts of Smit this time as it had planned to do last year.
Smit shares were up 6.1 percent at 59.0 euros at 1053 GMT in Amsterdam, while Boskalis shares were down 3 percent at 25.33 euros.
"Although Boskalis is not overpaying, we expect the synergies to be limited. Moreover, we continue to expect that Boskalis will face substantial margin pressure in the coming years," Petercam analyst Bart van den Wijngaard said in a note.
Smit's businesses will continue to operate under the Smit name out of their current Rotterdam headquarters, and its chief executive Ben Vree will join the new management board. Smit will also have a representative on the supervisory board.
"We have a clear agreement regarding the continuity of Smit's identity and its strategy, thereby securing the continuity of Smit's activities," Vree said in a statement.
Smit has four divisions: harbour towage, services for onshore and offshore terminals, salvage and transport/heavy lifting services.
"We think that the inclusion of harbour towage in the merger was necessary to get the support from the board of management and supervisory board of Smit. In earlier discussions, Boskalis always indicated that it intended to sell the Harbour Towage operations to a third party," Van den Wijngaard said.
60 EUROS PER SHARE
Under the terms of the deal, Boskalis will pay 60 euros per share in cash for all outstanding shares. The failed 2008 offer had been for an indicative price of 62.50 euros per share.
Boskalis Chief Executive Peter Berdowski told reporters the price would be about 1.1 billion euros ($1.65 billion) after excluding 250 million euros in debt and including the roughly 25 percent stake in Smit that Boskalis already holds.
Excluding the Boskalis stake, the remaining purchase price would come to about 825 million euros.
Boskalis intends to finance the offer with a mix of senior debt and equity, including 200 million euros' worth of new Boskalis shares. HAL Investments, a large Boskalis shareholder, has indicated it will take part in the issue.
Smit said its management and supervisory boards will "take a view on the level of the intended offer at a later date" in cooperation with financial advisor Royal Bank of Scotland.
Boskalis said major Smit shareholder Delta Lloyd (DLL.AS) and Janivo Beleggingen NV had irrevocably agreed to support the offer. The three collectively hold 44 percent of Smit.
The deal is expected to close in the first half of 2010 and add to Boskalis's earnings per share in that year.
Boskalis said any impact on the combined company's workforce would be limited.
Separately Thursday, Smit reported a third-quarter net profit of 75.1 million euros, down year-on-year due to lower revenues in the harbour towage and transport and heavy lift businesses. It also maintained its 2009 outlook. ($1=.6668 euros) (Additional reporting by Aaron Gray-Block, editing by Will Waterman and Mike Nesbit)
