Private equity group Candover is to make a cash offer for Dutch industrial company Stork of 47 euros per share, valuing it at 1.5 billion euros ($2.02 billion), Stork said on Tuesday.
The offer is supported and recommended by shareholders Centaurus and Paulson, who called for a break-up of the group last year, as well as Stork's supervisory board, including three court-appointed members, and the management board, the company said.
Hedge funds Centaurus and Paulson hold a combined 33% stake.
Stork supplies components to aircraft manufacturers Airbus and Boeing, services Fokker aircraft, makes machines for food processing and is one of the largest technical service providers in the Netherlands.
The intended offer represents a 19% premium over Stork's average closing share price of 39.38 euros for the three months prior to June 19 when the company announced talks with Candover on an offer, Stork said.
Stork shares were 2.3% up at 47.15 euros, versus a 0.5% drop in the mid-cap index.
Likely to Succeed
"We believe this bid is likely to succeed, given the support of Centaurus and Paulson," Petercam analyst Luuk van Beek wrote in a note. He said chances of a competing bid were low.
Stork said the proposed takeover by Candover would give it the financial muscle to expand.
"Candover supports our strategy and has agreed to structure the financial leverage in such a way that it provides the financial flexibility needed during this growth phase," Jan Kalff, chairman of Stork's supervisory board, said in a statement.
The company, together with Centaurus and Paulson, will ask the enterprise chamber to end an inquiry on management's handling of the business, Chief Executive Sjoerd Vollebregt told reporters on a conference call.
The inquiry was launched in January following a dispute between Stork and the hedge funds over its strategy and make-up.
London Acquisition B.V., a holding company controlled by funds managed and advised by Candover, is making the ex-dividend bid.
Stork said the offer implied a multiple of about 10 times 2006 normalised earnings before interest, tax, depreciation and amortisation (EBITDA) of 162 million euros.