Siemens to buy Canada's RuggedCom for C$382 million
FRANKFURT (Reuters) - Siemens (SIEGn.DE: Quote) has agreed to buy RuggedCom Inc RCM.TO, a Canadian maker of data communications networks systems, for about C$382 million ($381 million) in cash, to improve access to markets in North America and the Asia-Pacific region.
The deal, considered small for Europe's biggest engineering company, is its largest since Siemens took over Israeli solar thermal fields maker Solel for $418 million in 2009.
The Germany company said on Monday it would offer C$33.00 per share to RuggedCom, which represents a premium of 26 percent to the Canadian company's closing on Friday.
RuggedCom, which had revenues of around US$94 million last year and employs 360 people, makes heavy-duty routers and ethernet cables specifically designed in challenging environments such as those found in electric power substations and smartgrids.
Anton Huber, Chief Executive of Siemens Industry Automation division, said the acquisition of RuggedCom would improve Siemens' router and switch products as well as improve access to markets in North America and the Asia-Pacific region.
The German company's portfolio of industrial ethernet networking components is enjoying above-average growth rates compared with the competition, he said without elaborating.
"It's not a large company and is a good move as Siemens will be able to reduce its cash pile," analyst Pascal Gottmann of Merck Finck said.
Siemen's offer had topped a recent C$280 million offer from U.S. manufacturer Belden Inc (BDC.N: Quote).
RuggedCom's board of directors will recommend shareholders to accept the offer, Siemens said.
($1 = 1.0016 Canadian dollars)
(Reporting by Marilyn Gerlach in Frankfurt and Bhaswati Mukhopadhyay in Bangalore; Editing by Saumyadeb Chakrabarty and Erica Billingham)
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