M & A, Industry, Italian Primacy, Prysmian-General Cable, a turnover of 11 billion with 31 thousand employees in 50 countries and an adjusted (adjusted) Ebitda of around 930 million euros, an Italian company at the top of the world in the cables
Prysmian buys General Cable and consolidates its position as a world leader in the cable industry. The $ 3 billion deal was announced yesterday and will be finalized in the coming months. The former Pirelli Cavi will take over 100% of General Cable at a price of 30 dollars per share, completing a long courtship lasted for years and postponed only for the attempt to restructure the American group. Prysmian, on the other hand, after the acquisition of Draka, was looking for new outlet markets and the United States was the most anticipated landfall.
Prysmian-General Cable, an Italian company at the top of the world
Prysmian valued General Cable with 81% of the price reached on July 14 last, the last day of trading before the announcement by the company to launch a process of analysis of strategic alternatives. The transaction now awaits the approval of the majority of shareholders. “The acquisition of General Cable represents a milestone for the Prysmian Group and a strategic and unique opportunity for creating value for our shareholders and our customers”, exhorts Valerio Battista, CEO of the Prysmian Group. «Thanks to the consolidation of these two primary companies in the cable sector, we will be able to increase our position in the market, increasing our presence in North America and the footprint in Europe and South America».
“This union represents an ideal strategic choice and ensures that we are well positioned to face future opportunities and challenges in the dynamic and ever-changing cable industry. Together, we will be able to offer a solid portfolio of products and services and innovation with new products worldwide in the cable industry, “adds John E. Welsh, III, non-executive president of the General Cable Board.
Capital increase
Prysmian will evaluate the opportunity of a 500 million euro capital increase in the coming months, which will be partially covered by the expected cost synergies for 150 million euro fully operational within five years (while the integration costs are estimated at 220 million euro). EUR). The synergies will be mainly generated thanks to an improvement in the procurement strategy, an increase in the efficiency of general costs and the optimization of the production structure. At the end of the process, Prysmian should see its profits grow 10-12% from the first year.
The masterpiece of Valerio Battista
The Prysmian-General Cable business is the masterpiece of Valerio Battista, the manager who grew up in Pirelli and then called by Marco Tronchetti Provera to take care of the Telecom Italia cables. In 2002, Battista took over a 40 million ebitda and 600 million debt payment. He cut, cleaned and created a jewel that Goldman Sachs was happy to notice when Telecom found itself in trouble. Renamed Prysmian, the company started running until it was listed on the stock exchange.
Today it is fully the only Italian public company that has become a world leader in its market without having to report to any reference shareholder. And it will grow with the American business that, at the time of the finalization expected for the third quarter of 2018, will generate a group of 11 billion turnover with 31 thousand employees in 50 countries and an adjusted (adjusted) Ebitda of about 930 million euros
Source Business People
