Emhart Corp., which rejected a $2.4-billion takeover offer earlier this month, and Black & Decker Corp., the world’s leading producer of power tools and household products, announced today a $2.8-billion merger agreement.
Under the agreement, a subsidiary of Black & Decker will begin a tender offer for all outstanding shares of Emhart common stock at $40 a share. At least two-thirds of Emhart’s common, on a fully diluted basis, must be validly tendered, according to terms of the agreement.
Any shares not acquired in the tender offer will be acquired at $40 a share in a subsequent merger, the companies said in a news release.
The agreement, unanimously approved by the boards of directors of both companies, comes shortly after Farmington-based Emhart, a producer of industrial and commercial products and information and electronic systems, spurned the unsolicited, $35-a-share offer from the Topper Acquisition Corp., a New York-based investment group that includes oil heir Gordon P. Getty.
CEO Tells Approval
“I support the Black & Decker offer,” Peter Scott, Emhart president, chairman and chief executive officer, said in a prepared statement.
“I believe it presents an excellent opportunity for the Emhart shareholders at a time of volatile financial markets and also is in the best interest of Emhart’s employees and other constituencies.
“The agreement with Black & Decker also alleviates my concern that prolonging the takeover battle with Topper could have adverse effects on certain segments of Emhart’s business,” he said.
Nolan Archibald, Black & Decker’s president and chief executive officer, said the acquisition of Emhart will broaden the company’s product base and provide “excellent growth opportunities for Black & Decker for years to come.”
Scott will become director and chairman of the board of Black & Decker. Archibald will continue as president and chief executive officer of Black & Decker.