Technitrol, Inc. announced that it has sent a letter to the Board of Directors of Bel Fuse Inc. offering to acquire the company for $40.30 per share, or $480 million, in cash. Technitrol claims that combining the two companies would create a world-leading electronic component producer very well positioned to capture profitable growth opportunities across a variety of markets for magnetics, modules and interconnect products.
The offer price represents premiums of 38% and 21% to the closing prices on Thursday, March 22, 2007 of Bel Fuse’s Class A and Class B shares, respectively. The all-cash offer exceeds the highest price achieved by either class of stock during the past two years. Technitrol would finance the transaction with cash on hand and debt. The company also offered to provide part of the consideration in Technitrol stock, should Bel Fuse so desire.
"We believe that we are offering compelling value to Bel Fuse’s shareholders," said Technitrol Chairman and Chief Executive Officer James M. Papada, III. "And we are excited about the opportunities that the merged company will offer Technitrol’s shareholders, customers and employees. The combined company will be a larger, stronger electronic components business able to deliver an expanded product offering more effectively and efficiently to a larger customer base in a wide range of industries. We have identified several areas where we believe we can realize significant cost and expense savings, such as the integration of our sales forces and administrative functions."
Technitrol’s letter containing the offer was sent to Bel Fuse’s President and Chief Executive Officer, Daniel Bernstein. During 2006, Technitrol made several similar, but publicly undisclosed, offers to Bel Fuse. Bel Fuse refused to discuss these offers. In order to more fully comprehend Bel Fuse’s position, Technitrol offered to hold open discussions on valuation, but Bel Fuse did not accept, stating that it would rather remain independent. That offer was repeated in the most recent letter. As of the date of this story, Bel Fuse has not commented on the latest offer by Technitrol.
