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Shares of Circor International Inc. rocketed toward a near five-year high Monday after the flow-control-products company announced a deal to be acquired by KKR & Co. in a cash deal valued at $1.6 billion, including debt.
Under the terms of the deal, Circor shareholders will receive $49 for each Circor share they own, which represents a 54.7% premium to Friday’s closing price of $31.67 and implies a market capitalization for Circor of $999.1 million.
Circor’s
CIR,
stock soared 49.9% in morning trading, putting it on track to record the biggest one-day gain since it went public in October 1999. The stock was also headed for its highest close since October 2018.
KKR
KKR,
shares edged up 0.2%.
The deal, which is expected to close in the fourth quarter of 2023, follows a strategic review Circor initiated in March 2022.
“We believe that this transaction and the immediate cash value it will provide to Circor’s stockholders best achieves the Board’s goal of unlocking the significant incremental value within Circor for its stockholders,” said Circor Chair Helmuth Ludwig.
Circor Chief Executive Officer Tony Jajjar added: “We believe that having the support and resources of an experienced investor like KKR will help us expand our presence in the flow control space and support our mission to deliver the highest-quality products and services to our customers, many of which play a critical role in protecting national security.”
Once the deal closes, Circor said KKR will support the expansion of its stock-ownership program for its employees.
Circor’s stock has now run up 98.2% year to date, while KKR shares have advanced 15.8% and the S&P 500
SPX,
has climbed 11.6%.
