Heavy-duty supplier Accuride Corp. said it has entered into a definitive agreement to be acquired by funds managed by Crestview Partners, a leading New York-based private equity firm, for $2.58 per share in cash.
The approximate total value of the transaction will be about $477 million including debt and the value of post-retirement obligations, the company said.
In addition, the company sold its Brillion Iron Works subsidiary for $14 million to a subsidiary of Metaldyne Performance Group Inc., a provider of highly engineered components for use in powertrain and suspension applications for the global light, commercial and industrial vehicle markets, it said.
The purchase price for Accuride Corp. represents a premium of 55% over its closing share price on Sept. 1 and a premium of 66% over the 30-day volume weighted average price as of the same date, the Evansville, Indiana-based company said.
“After the transaction closes, Accuride will operate as a stand-alone business within Crestview’s portfolio of companies,” Accuride CEO Rick Dauch said in a statement.
It will continue to operate under its current brand name and remain headquartered in Evansville, Indiana, with operations in the United States, Canada, Mexico and Italy, according to the company.
Dauch and the members of the company’s leadership team will continue to lead the business after the transaction closes, the company said.
“Accuride will serve as a platform for further growth and consolidation in the global wheels and wheel-end sectors as we expand to serve our customers’ needs worldwide. We are confident that under Crestview’s stewardship, Accuride will receive the resources and support needed to realize our vision of becoming the premier supplier of wheel end system solutions to the global commercial vehicle industry,” Dauch said.
The company’s products include commercial vehicle wheels and wheel-end components and assemblies, it said.
Its board of directors unanimously approved the Crestview transaction and agreed to recommend the company’s shareholders vote to adopt the merger agreement, it said Sept. 2. It is expected to close in the fourth quarter of 2016.
Also, investment funds affiliated with Cetus Capital, who collectively hold about 17% of the outstanding Accuride shares, have entered into a customary voting agreement to support the Crestview transaction, it said.
The company expects to hold a special meeting of its shareholders to consider and act upon the proposed merger as promptly as practicable, it said.
New York-based Crestview Partners was founded in and is a value-oriented private equity firm focused on the middle market and manages funds with over $7 billion of aggregate capital commitments.
Located in Brillion, Wisconsin, Brillion specializes in the casting design and production of iron castings for a range of industries, including light vehicle, commercial vehicle, agricultural, construction, oil & gas and mining equipment, among others, it said.
“Today’s action will enable Accuride to focus completely on our strategic vision to be the premier supplier of wheel-end system solutions to the global commercial vehicle industry,” Dauch said.
Metaldyne Performance Group, based in Southfield, Michigan, produces precision components and modules using complex metal-forming manufacturing technologies and processes for a global customer base of vehicle manufacturers and their major suppliers, the company said.