VT Group agrees to accept £1.3 billion Babcock offer
24 Mar 2010
Defence services company VT Group Plc. has agreed to accept a takeover offer from rival Babcock International Group Plc., which provides support to the British Royal Navy's submarine fleet.
The £1.33 bllion ($1.9 billion) cash-and-shares deal will mark the emergence of a support services powerhouse that will have a market capitalisation of about £2 billion.
Under the deal VT shareholders will receive 361.6 pence a share in cash and 0.701 new Babcock shares for each VT share they hold.
The acquisition represents a value of 750 pence per VT Share, based on the undisturbed closing price of 554 pence per Babcock share on 12 February 2010, representing a premium of approximately 42 per cent, the company said in a statement.
There will be a mix-and-match facility, enabling shareholders to choose more or less cash, according to demand.
However, VT shareholders will not receive a final dividend in respect of the year to March 2010.
''The acquisition of such a high quality and complementary business is in line with our strategy to be the leading engineering support services company in the UK,'' said Mike Turner, chairman of Babcock.