Ameron International to be bought by National Oilwell
Ameron International Corp., the Pasadena industrial parts maker that faced a yearlong fight with dissident shareholders, has agreed to be sold for $772 million in cash to the world’s biggest provider of oil field equipment.
The $85-a-share offer from National Oilwell Varco Inc. represented a 28% premium over Friday’s closing price for Ameron stock.
Boards of both companies unanimously approved the deal, which was disclosed Tuesday. The transaction could close as early as the last quarter of this year.
Ameron Chief Executive James Marlen, who was scheduled to retire next year, praised the deal as an “outstanding value” for Ameron shareholders and said the shareholder infighting played no role in the sale.
“I think it is a magnificent move for the shareholders to receive a 30% premium in very difficult economic times,” Marlen said in an interview.
Talks with National Oilwell became serious last fall and several other companies had inquired about buying Ameron, Marlen said.
Ameron makes fiberglass-composite pipes for oil, chemicals and other fluids, as well as construction materials and fabricated steel products.
National Oilwell expects Ameron’s products to benefit its oil field pipe operations through efficiencies and economies of scale, Chairman Pete Miller said in a statement
Marlen, Ameron’s chief executive since 1993, came under pressure last year when activist investor James Mitarotonda of hedge fund Barington Group in New York began agitating for reforms and sought a seat on the board. Barington Group first invested in Ameron in December 2009.
Mitarotonda contended that Marlen enriched himself and his family while failing to deliver value to shareholders. Barington noted that in 2009, Marlen’s total compensation of $5.9 million exceeded that of chief executives from larger competitors. The hedge fund also pointed out that Ameron or its affiliates had employed Marlen’s three sons.
After a vicious proxy fight early this year, shareholders sided with Barington and voted Mitarotonda onto the board.
“If there’s one thing I regret, it’s having employed my three sons — not because of performance, but because the perception does not look good,” Marlen told The Times in March.
Marlen described his relationship with Mitarotonda as “civil” since the latter joined the board in March.
Mitarotonda did not respond to requests for comment Tuesday.
Ameron’s shares rose $18.81 to $85.08 on Tuesday. The stock’s close above the merger offer price could indicate that the market believes another buyer exists for Ameron, but “barring any antitrust issues” the deal will probably go through, analyst Brent Thielman at D.A. Davidson & Co. said.
National shares rose $1.74, or 2.2%, to $80.05.
The deal combines “two leading global competitors” in the fiberglass pipe business, Thielman wrote in a report. Ameron derived about half its $503 million in revenue last year from the fiberglass pipe segment, he noted.
Marlen said the future of Ameron’s Pasadena headquarters and roughly 2,900 employees worldwide would be up to National Oilwell. The Houston company did not respond to a request for comment Tuesday.
