Grupo FerroAtlántica, Globe Specialty Metals Agree To $3.1 Bln Combination

(RTTNews) - Grupo FerroAtlántica, a producer of silicon metal, silicon alloys and ferroalloys, and Globe Specialty Metals, Inc. (GSM), a low-cost silicon metal and silicon-based alloy producer, said they have entered into a definitive agreement for the two companies to combine in an all-stock transaction to create a leading international silicon and specialty metals producer. The new company will have a combined enterprise value of about $3.1 billion.

The transaction has been unanimously approved by the Board of Directors of both companies. The parties intend to close the transaction in the fourth quarter of 2015.

It is expected to be accretive to Globe's shareholders on an earnings per share basis in the first year following completion.

FerroAtlántica is wholly owned by Grupo Villar Mir, one of Spain's largest private companies.

The new company will have pro-forma combined revenues of around $2.3 billion and earnings before interest, tax, depreciation and amortization of approximately $325 million before synergies. It will capitalize on an enhanced product offering and a diversified production base.

At close, Grupo Villar Mir will hold a 57 percent ownership stake in the new company, and current Globe shareholders will hold a 43 percent stake. Globe intends to continue its current dividend policy through the closing date.