UPDATE: Piper Jaffray Downgrades Edwards Group to Neutral Following Atlas Copco Merger Announcement
In a report published Tuesday, Piper Jaffray analyst Jagadish Iyer downgraded the rating on Edwards Group Ltd. (NASDAQ: EVAC) from Overweight to Neutral, and lowered the price target from $12.00 to $10.00.
In the report, Piper Jaffray noted, “Edwards announced this morning that it has entered into a definite merger agreement with Swedish based industrial company, Atlas Copco (ATCO A, ATCO B), in a transaction valued up to $1.6bn including assumption of net debt of £248m (~$387m). The initial payment of $9.25/share in cash represents a 11% premium to EVAC's 30 day avg. closing price of $8.33 and is payable at the deal's close, likely in 1Q14. An additional payment ranging from $0.25-$1.25/share is payable based on Revenue and EBITDA thresholds achieved by EVAC in CY13. Atlas Copco and EVAC do not have any major product overlaps and we believe the combination broadens out the offering, particularly in the general industrial-segment.”
Edwards Group Ltd. closed on Monday at $8.45.
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