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John Bean's (JBT) Marel Offer Gets Iceland Regulator's Approval
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John Bean Technologies Corporation (JBT - Free Report) announced that Iceland's financial regulator has approved the offer document and prospectus related to its voluntary takeover bid for Marel. Following this development, JBT will officially launch the voluntary takeover offer to acquire all shares of Marel.
Subject to a proration feature, Marel shareholders will have a choice in how they receive payment for their shares. In exchange for each Marel share, they can opt for either all cash (€3.60 per share) or 0.0407 JBT shares. They can also opt for a mix of both (€1.26 in cash and 0.0265 JBT shares). The offer will commence from Jun 24, 2024, and expire on Sep 2, 2024.
Headquartered in Iceland, Marel is an international food processing company. It manufactures equipment and provides other services to the poultry, meat and fish industries. John Bean had made the first offer to Marel at €3.15 per share in November 2023, which was subsequently increased to €3.40 per share in December 2023. On Jan 19, 2024, JBT announced that it had made an updated offer to acquire the outstanding common shares of Marel at €3.60 per share.
In April 2024, JBT and Marel signed a definitive transaction agreement related to the voluntary takeover offer. It was also approved by the boards of directors of both companies.
The proposed merger will unite two renowned companies with complementary product portfolios, well-known brands and advanced technology. The combined company, which is expected to be named JBT Marel Corporation, is expected to become a leading and diversified global food and beverage technology solutions provider. It will have a secondary listing on Nasdaq Iceland, subject to applicable approvals, in addition to a NYSE listing.
Based on the proration feature and the agreed-upon John Bean’s reference share price of $96.25 per share, the final compensation mix is expected at 65% stock and 35% cash. Marel stockholders will receive €950 million in cash and own approximately 38% of the combined company.
The combined company will likely have proforma annual revenues of $3.5 billion and an adjusted EBITDA margin of around 16%.
Subject to regulatory clearance processes, including those required under antitrust and competition laws, the deal is expected to close by the end of 2024. Within three years of the completion of the transaction, the anticipated cost synergies are expected to exceed $125 million, driven by efficiencies in procurement, manufacturing, and general and administrative functions.
JBT Marel is also expected to realize additional revenue synergies of more than $75 million, given attractive cross-selling, go-to-market effectiveness, scaled innovation and enhanced global customer care capabilities. The deal is further anticipated to be accretive to earnings per share within the first full year of closing.
JBT expects to use some of its existing cash on hand to finance the transaction. It will also use a €1.9 billion fully committed bridge financing facility to guarantee the funding of the cash portion of the transaction, pay off Marel's outstanding debt, refinance JBT's existing debt, and pay transaction fees and related expenses.
Price Performance
John Bean’s shares have lost 15.1% in the past year against the industry’s 13.7% growth.
Image Source: Zacks Investment Research
Zacks Rank & Other Stocks to Consider
John Bean currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Kaiser Aluminium’s 2024 earnings is pegged at $4.12 per share, which indicates year-over-year growth of 50.4%. The consensus estimate for earnings has gone up 15% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 137%. KALU shares have gained 30% in the past year.
The consensus estimate for Zebra Technologies’ 2024 earnings is pegged at $12.11 per share. The consensus estimate for earnings has moved up 9% in the past 60 days. The estimate indicates year-over-year growth of 23%. The company has a trailing four-quarter average earnings surprise of 8.56%. ZBRA shares have gained 10% in a year.
The Zacks Consensus Estimate for Brady’s 2024 earnings is pegged at $4.13 per share, which indicates year-over-year growth of 13.5%. The consensus estimate has moved up 3% in the past 30 days. The company has a trailing four-quarter average earnings surprise of 6.7%. BRC shares have gained 39% in the past year.
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John Bean's (JBT) Marel Offer Gets Iceland Regulator's Approval
John Bean Technologies Corporation (JBT - Free Report) announced that Iceland's financial regulator has approved the offer document and prospectus related to its voluntary takeover bid for Marel. Following this development, JBT will officially launch the voluntary takeover offer to acquire all shares of Marel.
Subject to a proration feature, Marel shareholders will have a choice in how they receive payment for their shares. In exchange for each Marel share, they can opt for either all cash (€3.60 per share) or 0.0407 JBT shares. They can also opt for a mix of both (€1.26 in cash and 0.0265 JBT shares). The offer will commence from Jun 24, 2024, and expire on Sep 2, 2024.
Headquartered in Iceland, Marel is an international food processing company. It manufactures equipment and provides other services to the poultry, meat and fish industries. John Bean had made the first offer to Marel at €3.15 per share in November 2023, which was subsequently increased to €3.40 per share in December 2023. On Jan 19, 2024, JBT announced that it had made an updated offer to acquire the outstanding common shares of Marel at €3.60 per share.
In April 2024, JBT and Marel signed a definitive transaction agreement related to the voluntary takeover offer. It was also approved by the boards of directors of both companies.
The proposed merger will unite two renowned companies with complementary product portfolios, well-known brands and advanced technology. The combined company, which is expected to be named JBT Marel Corporation, is expected to become a leading and diversified global food and beverage technology solutions provider. It will have a secondary listing on Nasdaq Iceland, subject to applicable approvals, in addition to a NYSE listing.
Based on the proration feature and the agreed-upon John Bean’s reference share price of $96.25 per share, the final compensation mix is expected at 65% stock and 35% cash. Marel stockholders will receive €950 million in cash and own approximately 38% of the combined company.
The combined company will likely have proforma annual revenues of $3.5 billion and an adjusted EBITDA margin of around 16%.
Subject to regulatory clearance processes, including those required under antitrust and competition laws, the deal is expected to close by the end of 2024. Within three years of the completion of the transaction, the anticipated cost synergies are expected to exceed $125 million, driven by efficiencies in procurement, manufacturing, and general and administrative functions.
JBT Marel is also expected to realize additional revenue synergies of more than $75 million, given attractive cross-selling, go-to-market effectiveness, scaled innovation and enhanced global customer care capabilities. The deal is further anticipated to be accretive to earnings per share within the first full year of closing.
JBT expects to use some of its existing cash on hand to finance the transaction. It will also use a €1.9 billion fully committed bridge financing facility to guarantee the funding of the cash portion of the transaction, pay off Marel's outstanding debt, refinance JBT's existing debt, and pay transaction fees and related expenses.
Price Performance
John Bean’s shares have lost 15.1% in the past year against the industry’s 13.7% growth.
Image Source: Zacks Investment Research
Zacks Rank & Other Stocks to Consider
John Bean currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the Industrial Products sector are Kaiser Aluminum (KALU - Free Report) , Zebra Technologies (ZBRA - Free Report) and Brady (BRC - Free Report) . While KALU and ZBRA sport a Zacks Rank #1 (Strong Buy), BRC carries a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Kaiser Aluminium’s 2024 earnings is pegged at $4.12 per share, which indicates year-over-year growth of 50.4%. The consensus estimate for earnings has gone up 15% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 137%. KALU shares have gained 30% in the past year.
The consensus estimate for Zebra Technologies’ 2024 earnings is pegged at $12.11 per share. The consensus estimate for earnings has moved up 9% in the past 60 days. The estimate indicates year-over-year growth of 23%. The company has a trailing four-quarter average earnings surprise of 8.56%. ZBRA shares have gained 10% in a year.
The Zacks Consensus Estimate for Brady’s 2024 earnings is pegged at $4.13 per share, which indicates year-over-year growth of 13.5%. The consensus estimate has moved up 3% in the past 30 days. The company has a trailing four-quarter average earnings surprise of 6.7%. BRC shares have gained 39% in the past year.