Melrose chasing German meter firm
Engineering buy-out firm Melrose has confirmed speculation that it is in discussions to buy German group Elster.
Engineering buy-out firm Melrose has confirmed speculation that it is in discussions to buy German group Elster.
Reports said the deal could be worth over $2bn, but the firm is so far keeping the terms of any deal to itself.
However, Melrose did say that any transaction would be funded through a combination of new debt and a fully underwritten rights issue to it's existing shareholders.
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Elster is listed on the New York Stock Exchange and currently has a market capitalisation of $1.9bn.
The provider of gas, electricity and water meters generated revenues of $1.87bn in 2011.
"Elster agreed to due diligence which is currently on-going, and Melrose has indicated that it would not proceed with the transaction without a recommendation from the board of Elster and a hard irrevocable undertaking from Elster's largest shareholder, Rembrandt Holdings S.A., which is owned by funds advised by CVC Capital Partners," Melrose announced.
"The board of Melrose will only proceed with the transaction if it meets Melrose's acquisition criteria, including the terms on which financing for the transaction can be raised," the company added.
"This will include, but not be limited to, the Melrose share price at the time of announcement."
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