CEO To Take Pike Private In $12 Per Share Deal
Pike (NYSE: PIKE) signed a definitive $12 per share deal Monday to be acquired by its chief executive and a private equity firm.
The price represents a 50.8 percent premium over Pike's August 1 closing price and is expected to close in the fourth quarter, subject to shareholder approval.
In pre-market activity, Pike traded recently at $11.85, up more than 48 percent.
Pike, which provides engineering and construction for U.S. electric utilities, posted a five percent decline in profits for its most recent quarter ended March 31, while revenue fell 3.5 percent.
CEO J. Eric Pike, who held a 9.69 percent stake in the company as of its most recent proxy last year, said "operating in a private environment" will provide more "time investment and patience" to pursue a diversification strategy.
The deal is to be paid for with cash from the private equity group Court Square, as well as equity contributed by J. Eric Pike; debt financing from J.P. Morgan, KeyBank and SunTrust Bank, and cash on hand. There is no financing condition to the closing of the merger.
Pike's board will actively solicit alternate bids during a 30-day "go-shop" period included in the agreement.
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