Courtesy of Trade Only Today
Simrad Yachting AS will acquire outstanding shares of Lowrance Electronics in a $215 million deal that merges two marine electronics companies.
Under the terms of the agreement, Navico Acquisition Corp., a newly formed subsidiary of Simrad, will offer $37 a share in cash. After the tender offer, Lowrance will become a wholly owned subsidiary of Simrad, the companies said today.
Chairman and CEO Darrell Lowrance, who founded the company in 1957, will become CEO of the combined company. Jan Berner, CEO of Simrad Yachting, will be deputy CEO and will lead the integration work.
The board of directors unanimously approved the merger agreement. Lowrance and Ronald Weber, executive vice president of engineering and manufacturing, have agreed to tender their shares, which represent 16 percent of the outstanding shares.
"I believe the merger with Simrad Yachting is in the best interests of our company and shareholders," said Lowrance, in a statement. "The combination of Simrad Yachting and Lowrance will be able to leverage the technology and market position Lowrance has worked hard to develop over the last 48 years."
Lowrance shares jumped to $36.65 in early morning trading, a 52-week high and a 48 percent jump from Friday's close of $25 a share. Shares slightly dropped to $36.59 during mid-day trading.
The companies in a statement said they complement each other in product offerings and geographic footprints.
Lowrance, a manufacturer of marine electronics headquartered in Tulsa, Okla., has a particularly strong presence in the fishfinders and GPS navigation systems in the market. For the past decade, Lowrance has produced hand-held GPS mapping products for campers and hikers, as well as GPS navigation systems for the automotive and aviation markets.
Simrad, owned by Altor 2003 Fund, a Nordic-based private equity fund, manufactures marine electronics for high-end leisure boats.
"We in Simrad Yachting have learned to know Lowrance over some time, and are very impressed by the company, its management and what it has achieved," Hugo Maurstad, chairman of the board of Simrad, said in a statement.