KKR to acquire Gardner Denver for $3.74 billion

Fri Mar 8, 2013 9:00am EST
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(Reuters) - Private equity firm KKR & Co LP (KKR.N: Quote) will buy industrial machinery maker Gardner Denver Inc GDI.N for $3.74 billion, four months after the company put itself up for sale.

KKR's offer of $76 per share is at a premium of 3 percent to Gardner Denver's Thursday closing price on the New York Stock Exchange. It is 39 percent above what the stock traded at in late October when the company said it was exploring a sale.

Gardner Denver, which makes compressors, pumps and vacuum products for industrial uses, decided to put itself up for sale following months of pressure from activist investor ValueAct Capital LLC, which reported a roughly 5 percent stake in July 2012.

New York-based KKR has been in the pole position to buy Gardner Denver after other private equity bidders who initially took part in the auction abandoned the process ahead of the February 21 deadline for final bids, people familiar with the matter told Reuters.

The deal is valued at $3.9 billion including debt, the companies said in a statement.

Based on 49.15 million Garden Denver shares outstanding as of January 31, the equity portion of the deal is valued at $3.74 billion.

In late February, KKR bid $75 per share for Gardner Denver but the company sought a higher offer, according to the sources.

Diversified manufacturer SPX Corp SPW.N had also been in talks to buy Gardner Denver at $85 per share but abandoned plans after its shareholders questioned the logic of a merger.

KKR and Gardner Denver said they expected the deal to close in the third quarter of 2013.   Continued...

Henry Kravis of Kohlberg Kravis Roberts & Co. speaks during an interview in New York, April 3, 2012. REUTERS/Shannon Stapleton