New York-listed building products manufacturer Quanex has agreed terms to buy London-listed peer Tyman for £788m.
The two companies announced in a joint statement that under Quanex’s cash and share offer, Tyman shareholders would be entitled to receive 240p per each Tyman share and 0.05715 of a new Quanex share, currently valued at 160p.
Under an all-share alternative, Tyman shareholders could choose to receive shares in Quanex at a ratio of 0.14288 of a new Quanex share to every one Tyman share they hold. This alternative would also value each Tyman share at 400p and be made available in respect of up to 25 per cent of its outstanding shares.
The companies said Quanex’s offer marked a roughly 35.1 per cent premium to Tyman’s closing stock price of 296p on Friday, and around 40.5 per cent to the firm’s six-month volume weighted average price of 284.8p.
Under the agreement, Tyman would delist from the London Stock Exchange, and the combined group would be listed on the New York Stock Exchange—where Quanex currently trades.
Quanex said the deal aligned with its “BIGGER” strategy – including acquisitions, international expansion and product innovation.
The firms said the deal offered increased scale with combined revenues of around $2bn (£1.6bn) for the 2023 fiscal year 2023 and would be “meaningfully earnings accretive” in the first full financial years after the transaction completes, with “attractive profitability driven by significant synergy potential with a higher EBITDA margin”.
George L Wilson, chair, president and chief executive of Quanex, said: “With significantly enhanced scale, we are looking forward to fully optimizing our portfolio of products and assets to position Quanex as a comprehensive solutions provider for our customers. Importantly, we expect employees of both companies to also benefit from increased opportunities as part of a larger organization with expanded engineering, design and manufacturing capabilities.
“As one company, we will have an enhanced financial profile grounded in attractive margins, strong free cash flow and a healthy balance sheet, that will enable us to invest in organic and inorganic growth opportunities to deliver superior returns for investors.”
Nicky Hartery, non-executive chair of Tyman, added: “In the context of a rapidly evolving North American marketplace, our board ultimately determined that this transaction is the best path to maximising value for Tyman shareholders, who will be able to realise a meaningful portion of their holding in cash at a significant premium to the prevailing share price while also participating in the future upside of the enlarged group.”
