SPX FLOW, Inc. yesterday announced that it entered a purchase agreement with Lone Star Funds. Per the terms of the deal, Lone Star’s affiliate will acquire SPX FLOW in an all-cash transaction worth $3.8 billion.
The deal is approved by the board of directors of SPX FLOW. The company has also suspended quarterly dividend payments.
Shares of SPX FLOW gained 0.57% yesterday, ending the trading session at $86.12.
Lone Star, a private equity firm, provides ideas to funds engaged in investments in equity, real estate, credit, and others assets (financial).
Inside the Headlines
The transaction value, including debt assumption, represents a 40% premium over the last trading price of SPX FLOW’s shares on Jul 16, 2021. The deal has been considered by SPX FLOW in the best interests of its shareholders. Also, its combination with Lone Star will benefit customers with better products and services.
For Lone Start, the deal is a win-win situation as the SPX FLOW acquisition will enhance its product offerings, employee base and innovation capabilities.
The transaction is expected to be completed in the first half of 2022, after the receipt of approvals from shareholders of SPX FLOW and regulatory authorities, and fulfilling certain closing conditions.
After being acquired, SPX FLOW will cease its trading activities on The New York Stock Exchange.
Zacks Rank, Price Performance and Earnings Estimates
With a market capitalization of $3.6 billion, SPX FLOW currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past three months, SPX FLOW’s shares have increased 11.2% compared with the industry’s gain of 2.9%.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for the company’s earnings per share is pegged at $2.97 for 2021 and $4.00 for 2022, reflecting increases of 8.4% and 23.5% from the respective 60-day-ago figures. The consensus estimate for the fourth quarter of 2021 of 94 cents has jumped 17.5% over the pa st 60 days.