News

Delta to Pay $517 Million for Eltek

December 15, 2014 by Jeff Shepard

The Board of Directors of Eltek ASA announced an agreement with Deltronics (Netherlands) B.V., a wholly owned subsidiary of Delta Electronics, Inc., whereby the Deltronics will offer to acquire all of the shares of Eltek through a voluntary cash offer of NOK 11.75 per share. The Board of Directors of Eltek recommends the shareholders of Eltek to accept the offer. The Voluntary Offer values the total share capital of Eltek at approximately NOK 3.87 billion (about US$517 million). Shareholders representing 76.6% of the total share capital of Eltek, including Elteks largest shareholders, Ketlav Invest AS, CC Industries Inc. and Eltek Holding AS, have irrevocably undertaken to accept the Voluntary Offer for their shares in the Company.

The Deltronics and Eltek have entered into a transaction agreement regarding an acquisition of Eltek by the Deltronics. Under the terms of the agreement, the Deltronics will put forward a recommended voluntary cash offer (the Voluntary Offer) pursuant to the Norwegian Securities Trading Act for all of the shares of Eltek. Deltronics (Netherlands) B.V. is a 100% owned subsidiary of Delta Electronics, Inc., which was founded in 1971 and is the global leader in power and thermal management solutions. Delta Groups mission is To provide innovative, clean and energy-efficient solutions for a better tomorrow, which guides its core business in developing innovative energy-saving products and solutions in the categories of power electronics, energy management, and smart green life.

“This transaction is very positive for Eltek and its stakeholders. Through a combination with Delta, Eltek becomes an even stronger force in the power conversion industry. In addition, the Voluntary Offer represents highly attractive value creation for Elteks shareholders,” says Erik Thorsen, Chairman of the Board of Directors of Eltek.

The consideration offered will be NOK 11.75 per Eltek share (the Offer Price). The Offer Price represents a premium of approximately 20.3% to the closing share price of Eltek on Friday 12 December 2014. The Offer Price represents a premium of approximately 35.1% compared to the closing share price of Eltek on 30 October 2014, the last trading day prior to the announcement regarding Elteks evaluation of strategic options for the future development of Eltek, and a premium of 34.7% compared to the one month volume weighted average share price of Eltek for the period ending on 30 October 2014.

The Board of Directors has been assisted by its financial advisers Citigroup Global Markets Limited and Arctic Securities AS in the evaluation of the Offer Price and the Board of Directors has taken into account, amongst other things, such advice to recommend the Voluntary Offer. The Offer will not be subject to any financing or due diligence conditions.