The billionaire Pritzker family will buy scrap mill servicing company TMS International Corp TMS.N for about $687 million in cash.
The offer of $17.50 from the Pritzker Organization represents a premium of about 12 percent to TMS's Friday close of $15.57. Including debt, the deal is valued at about $1 billion.
The Pritzker Organization is a merchant bank run by certain members of Chicago's Pritzker family, which controls Hyatt Hotels (H.N), Triton Container and the Marmon Group.
TMS, controlled by Canada's Onex Group, helps steel mills buy and sell scrap and manage slag, a by-product of the steel making process. It operates 36 brokerage offices across five continents.
Onex Group's affiliates, including Onex Corp OCX.TO, hold about 60 percent of TMS.
BofA Merrill Lynch advised TMS on the deal, which is expected to close in the fourth quarter. Kaye Scholer LLP was its legal adviser.
Goldman, Sachs & Co and J.P. Morgan Securities LLC were financial advisers for the Pritzker Organization, while Latham & Watkins LLP acted as its legal adviser.
(Reporting by Bhaswati Mukhopadhyay and Swetha Gopinath in Bangalore; Editing by Saumyadeb Chakrabarty)