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Stork's Board Support New Takeover Bid from Candover

Dutch industrial engineering company Stork said Wednesday its board and major shareholders support a new 1.5 billion euros ($2.2 billion) takeover bid, likely ending a stalemate over the company's future.

London Acquisition, a holding company controlled by funds managed and advised by U.K.-based private equity firm Candover Investments, said it will go through with a 48.40 euros ($71.35) a share bid for the company.

Stork shares rose 7.5 percent on the news to 47.90 euros ($70.58).

The company makes an array of industrial equipment ranging from kitchen equipment to textile printing and chicken slaughtering machines, and is a supplier to aerospace companies such as Airbus maker EADS.

A bid from Candover was first announced in June, but it withdrew it in September as an Icelandic consortium led by Marel HF indicated it would not tender shares under the offer. The consortium, named LME, reported a shareholding interest in Stork above 43 percent.

LME had gradually raised its stake in Stork in an attempt to block the planned takeover by Candover and made no secret of the fact that it was primarily interested in Stork's food systems division, whereas Candover wanted to acquire the whole company.

Now, as part of its bid, Stork's Food Systems division will be sold to Marel for 415 million euros ($611 million). As a consequence, around 77 percent of Stork shareholders support the bid.

Stork's management and supervisory boards recommended the Candover bid. Stork management has been under pressure for more than a year from shareholders who wanted to break up the company.

"The situation around Stork became more and more complex and I'm pleased that we jointly succeeded to find a solution that is realistic and feasible," Stork CEO Sjoerd Vollebregt said in a statement.

"This offer as well as the subsequent sale of Food Systems to a well-known and reputable strategic buyer will put to an end the turbulent situation in which the company has found itself for almost two years," he added.

Petercam analyst Luuk van Beek said the bid is likely to succeed given that it's supported by most of the shareholders. He raised his rating on the stock to hold from sell.

"The price Marel will pay for Food Systems is somewhat higher than our expectation and we do not believe there will be a competing bid for the unit," Van Beek said.