Wabtec Corporation (NYSE: WAB) has signed a definitive share purchase agreement to acquire from members of the Faiveley family approximately 51% of Faiveley Transport S.A. (Euronext Paris: LEY), a leading global provider of value-added, integrated systems and services for the railway industry with annual sales of about $1.2 billion. On July 27, Wabtec announced that it had made an irrevocable offer to acquire these shares. Faiveley Transport has now completed required labor group consultations and the majority shareholders have accepted the Wabtec purchase offer.
Wabtec has also entered into a definitive tender offer agreement with Faiveley Transport and a definitive shareholders agreement with the majority shareholders of Faiveley Transport. Closing of the transactions is subject to various customary conditions, including completion of remaining regulatory requirements.
Under the share purchase agreement, Wabtec plans to purchase the shares for €100 per share, payable 25% in cash and 75% in Wabtec preferred stock, mandatorily convertible after three years into a total of approximately 6.5 million Wabtec common shares. Upon completing the share purchase, Wabtec will commence a tender offer for the remaining publicly traded Faiveley Transport shares. The public shareholders will have the option to elect to receive €100 per share in cash or Wabtec preferred stock. As is the case in the purchase of the Faiveley family block, no more than 75% of the consideration payable to the public shareholders can be in Wabtec preferred stock. The total purchase price is about
$1.8 billion, including assumed debt. Wabtec plans to fund the cash portion of the transaction with cash on hand, existing credit facilities and potentially other debt financing.
The strategic combination of Wabtec and Faiveley Transport will create one of the world’s largest public rail equipment companies, with revenues of about $4.5 billion and a presence in all key freight rail and passenger transit geographies worldwide.
Wabtec Corporation, with more than 13,000 employees in more than 20 countries and annual sales of about $3.3 billion, is a global provider of value-added, technology-based products and services for freight rail, passenger transit and other industrial segments. The company manufactures a range of products for locomotives, freight cars and passenger transit vehicles, new switcher and commuter locomotives and provides aftermarket services.
Faiveley Transport is a global supplier of high added value integrated systems for the railway industry. With more than 5,700 employees in 24 countries, Faiveley Transport generated sales of €1,048.4 million for the 2014/15 financial year. The Group supplies manufacturers, operators and railway maintenance bodies worldwide with the most comprehensive range of systems in the market: Energy & Comfort (air conditioning, power collectors and passenger information systems), Access & Mobility (passenger access systems and platform doors), Brakes & Safety (braking systems and couplers) and Services.