ELGIN, Ill. -- The Middleby Corp. has announced that is has executed a definitive agreement to acquire TurboChef Technologies Inc. in a cash and stock transaction valued at approximately $200 million, including TurboChef net cash of approximately $5 million as of June 30, 2008. TurboChef is a leading provider of equipment focused on the high-speed preparation of food products for the global commercial cooking equipment market.
Under the terms of the merger agreement, which has been approved by the boards of both companies, holders of TurboChef's common shares will receive a combination [image-nocss] of $3.67 in cash and 0.0486 Middleby shares of common stock per TurboChef share. The implied value per TurboChef share is $6.47 based on the closing price of Middleby's common stock as of Aug. 11, 2008. The transaction, which is expected to close in fourth-quarter 2008, is subject to approval by TurboChef shareholders, regulatory approvals and customary closing conditions. In connection with the merger agreement, certain officers and directors of TurboChef have entered into voting agreements with Middleby pursuant to which they have agreed to vote all of their shares (collectively representing approximately 20% of TurboChef's outstanding shares) in favor of the transaction.
Atlanta-based TurboChef is a leader in speed cook technology. Middleby said it believes this technology is in the early stages of gaining a broader market acceptance and intends to expand on TurboChef's initial success by leveraging Middleby's global sales and service platform as well as its core operating expertise.
Selim A. Bassoul, Middleby chairman and CEO, said, "TurboChef has done an exceptional job of taking revolutionary cooking technology and successfully commercializing it. The rapid growth in TurboChef's customer base is a testament to the quality and performance of its products and the excellence of its engineering and sales professionals. The acquisition of TurboChef will strengthen Middleby's position as a global leader in the foodservice equipment industry. Having created the speed cooking category, TurboChef is the most widely known brand name in the category. The addition of TurboChef's line of products will complement Middleby's existing industry leading brands and portfolio of innovative technologies."
Richard Perlman, TurboChef chairman, and Jim Price, president, commented, "We…believe this transaction is in the best long-term interests of TurboChef shareholders. We believe Middleby's manufacturing and operational expertise, global reach and installed customer base matches up extraordinarily well with TurboChef's leading-edge speed cook technology, R&D capability and industry leading customer service. We think this is a great transaction for TurboChef employees and TurboChef shareholders as they now have the opportunity to potentially benefit from holding Middleby stock."
Middleby said it expects TurboChef to become a meaningful contributor to its financial portfolio through the achievement of significant synergies from this transaction as a result of reducing corporate expenses, a reorganization of TurboChef's residential segment and other operating synergies. In the longer term, Middleby is confident that this acquisition will improve the company's future earnings growth potential as TurboChef's sales potential is realized, it said.
And Middleby expects to finance the acquisition by drawing on its existing revolving credit facility, which will be increased in connection with the transaction, it added.
Elgin, Ill.-based Middleby is a major player in the foodservice equipment industry. The company develops, manufactures, markets and services a broad line of equipment used for commercial food cooking, preparation and processing. The company's leading equipment brands serving the commercial foodservice industry include Blodgett, Blodgett Combi, Blodgett Range, Bloomfield, Carter Hoffman, CTX, Holman, Houno, Jade, Lang, MagiKitch'n, Middleby Marshall, Nu-Vu, Pitco Frialator, Southbend, Star, Toastmaster,and Wells. The company's leading equipment brands serving the food processing industry include Alkar, MP Equipment and RapidPak.
Click herefor a slideshow about the deal.
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