MANITOWOC, Wis. -- The Manitowoc Co. Inc. said that it has been notified by the U.K. Takeover Panel that Enodis plc intends to recommend Manitowoc's offer following completion of an auction process with Illinois Tool Works Inc. Manitowoc's successful bid was 328 pence per Enodis share, resulting in a transaction valued at approximately $2.7 billion, including the assumption of Enodis' net debt (approximately $249 million as of March 29, 2008).
The transaction will be structured as a court-sanctioned scheme of arrangement under the laws of the U.K. and is expected to close in fourth-quarter 2008. [image-nocss] The transaction is subject to court approval in the U.K., the approval of Enodis shareholders, as well as regulatory approvals in various jurisdictions. The Takeover Panel has advised Manitowoc that Illinois Tool Works will withdraw its offer to acquire Enodis subject only to the posting of the scheme document relating to Manitowoc's bid.
The amount of ITW's increased bid in the auction process was not disclosed by the Takeover Panel.
Listed in London and operationally headquartered in Tampa, Fla., Enodis, a global provider of commercial foodservice equipment with a variety of brands, reported revenues of 0.8 billion pounds Sterling (US $1.7 billion) for the 12 months ended March 29, 2008. Enodis is a major supplier of foodservice equipment, with products on the "cold" and "hot" sides of the industry. To date, Manitowoc Foodservice's focus has been on "cold" equipment. A combination with Enodis will allow Manitowoc to enter two major new market segments, hot foodservice and food retail equipment, as well as expand its cold-side businesses.
Glen E. Tellock, Manitowoc president and CEO, said: "Throughout this process, we reaffirmed our belief in the transforming opportunities that Enodis provides. Even at the higher price, we believe the strategic benefits of the combination are significant while remaining consistent with the strict financial disciplines that we have adhered to for all of our acquisitions. The enhanced global business platform resulting from the combination is expected to generate many benefits through deeper customer relationships, a more robust R&D process and operating synergies."
Manitowoc said it believes that the successful integration of the two businesses will result in improved growth prospects and the opportunity to deliver significant synergies. Management currently estimates that, by 2010, the transaction will generate annual synergies of more than $80 million. Historical revenues for the combined companies for the most recently completed respective financial years exceeded $5.6 billion.
"We believe the expanded global footprint of the combined businesses creates an outstanding growth platform," said Michael Kachmer, president of Manitowoc's Foodservice segment. "With the world's largest foodservice companies growing at rates well in excess of the overall industry, we should be well-positioned to partner with our customers in creating modern, efficient kitchens that deliver the dining choices that consumers want."
The transaction is subject to certain closing conditions, including the approval of Enodis shareholders, regulatory approvals in various jurisdictions and other customary closing conditions for a U.K. scheme of arrangement. Manitowoc has agreed to take the necessary steps to obtain these approvals. It is anticipated that this transaction will close by fourth-quarter 2008. There are no financing conditions in the proposed acquisition.
Enodis is a leading global food and beverage equipment manufacturers. Its operations comprise two primary divisions: Global Foodservice Equipment and Food Retail Equipment. Enodis' Global Foodservice Equipment businesses provide primary cooking, ovens, storage, preparation, holding, warewashing, ice machine, refrigeration and beverage equipment to restaurants and other customers worldwide. The Food Retail Equipment operations provide refrigeration systems, refrigerated display cases and walk-in cold storage rooms primarily to supermarkets and convenience stores in North America.
Manitowoc, Wis.-based Manitowoc is one of the world's largest providers of lifting equipment for the global construction industry, including lattice-boom cranes, tower cranes, mobile telescopic cranes, and boom trucks. As a leading manufacturer of ice-cube machines, ice/beverage dispensers, and commercial refrigeration equipment, the company offers one of the broadest lines of cold-side equipment in the foodservice industry. In addition, the company is a leading provider of shipbuilding, ship repair, and conversion services for government, military and commercial customers throughout the U.S. maritime industry.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.