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Business, Acquisitions, Global: French power company Schneider Electric is paying US$6.1 billion to buy American Power Conversion.
American Power
Conversion (APC) reports have frequently appeared on the Developing Telecoms
website, so the announcement of a merger with France’s
Schneider Electric is of considerable interest. Schneider provides solutions
for electrical distribution, industrial control and automation projects, and
will acquire all outstanding shares of APC for US$31 per share in cash.
Aggregate transaction value is approximately $6.1 billion.
What the two companies are aiming by combining is a
prominent business tackling both single-phase and three-phase uninterruptible
power supply. Another objective is to supply integrated systems for IT and data
centre applications.
The structure of the new enterprise is explained by Rob
Johnson, APC’s President and CEO: “This transaction provides APC stockholders
with an immediate and substantial cash premium for their investment in the
company. Upon completion of the transaction APC will become part of Schneider
Electric, with greater resources to accomplish our long-term plans, which will
be favourable for our employees, customers, business partners and suppliers
worldwide. Both companies have a dedication to innovation and customer service
that make our combined enterprise an even stronger, more competitive player in
the industry.”
The transaction is expected to close in 1Q07, when
shareholders are expected to vote on the transaction in early 2007. The Board
of Directors of APC has approved the transaction with Schneider, and intends to
recommend to APC’s shareholders that they approve the transaction. The approval
of Schneider Electric shareholders is not required.
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Date: 29-31 October, 2008