Nov 18 2010
Allegheny Technologies Incorporated (NYSE: ATI) and Ladish Co., Inc. (NASDAQ: LDSH) today announced that they have entered into a definitive merger agreement whereby ATI will acquire Ladish for an aggregate fully distributed equity value of approximately $778 million.
Ladish shareholders will receive $24.00 in cash and 0.4556 of a share of ATI common stock for each share of Ladish common stock. Based on the volume weighted average price of ATI common stock over the last 10 trading days ending November 16, 2010, the aggregate consideration on a fully diluted basis is $48.00 per Ladish share. The transaction is subject to normal closing conditions, including approval by Ladish shareholders, and is expected to be completed in early 2011.
“ATI’s unique industry-leading product portfolio combined with Ladish’s technologically advanced forging, investment casting, and machining capabilities creates a more integrated, stable, and sustainable supply chain for the aerospace, defense, and industrial markets,” said L. Patrick Hassey, ATI’s Chairman and Chief Executive Officer.
“We like the people, the technology, and the market position of Ladish. Our strategy is to build unsurpassed manufacturing capabilities and develop innovative new products that add value for our customers. With this strategic acquisition, we leverage these capabilities to forward integrate and better position ATI to capitalize on secular growth trends in our key markets.
“Ladish expects sales of approximately $400 million in 2010 and anticipates that sales will continue to grow with the aerospace market recovery. In addition, we believe at least $100 million of sales can be added through market synergies. We expect this acquisition to generate positive cash flow to ATI immediately after the transaction closes. We expect the acquisition to be accretive to earnings after the first year.”
Gary J. Vroman, Ladish President and CEO said, “We have been preparing and positioning our company for market growth. Highly skilled people are trained and in place, and our equipment is ready to go. Integrating Ladish’s manufacturing operations with ATI’s broad product range of specialty metals immediately enhances our ability to serve our existing customer base. Beyond that, there are new markets now well within our reach that were previously a stretch for us. Without question, this merger significantly improves the long-term outlook for Ladish. We are looking forward to what the future will bring for our 1,700 dedicated employees in the United States and Poland.”