London – Compagnie Générale des Établissements Michelin SCA (Michelin) is to acquire UK industrial rubber products group Fenner plc, the companies announced 19 Mar.
Fenner’s directors are “unanimously” recommending shareholders to accept the proposed cash acquisition, which values its share capital at around £1.2 billion (€1.4 billion).
The offer price of 610 pence per share represents a premium of 30.7% on Fenner's share price of 467 pence at the close of business on 16 Mar. The deal is expected to close in the second quarter.
The acquisition, said Michelin, will enable it to bring a “comprehensive offering” for the mining sector: combining the two groups’ tire and conveyor belt, product and services portfolios.
Michelin added that its engineered material division would add a “complementary” reinforced-polymers portfolio to its existing polymer activities.
"Michelin values the skills, experience and industry knowledge of Fenner's management and employees. Mastering high-technology materials is key to creating value in the coming years,” said Jean-Dominique Senard, CEO and managing general partner of Michelin.
“The acquisition will enable Michelin to accelerate its growth in this area, and to strengthen its position as a key player in the recovering mining markets with a comprehensive offering," added Senard.
While Fenner is delivering significant value to shareholders as an independent company, Michelin’s offer reflects the strength of its future prospects, according to Vanda Murray OBE, chair of Fenner.
"We find the cultural fit and business opportunities excellent with Michelin. Both companies have innovation in their DNA and are customer solution oriented," added Fenner CEO Mark Abrahams.