Huntsworth Surges on $511 Million Buyout Deal From U.S. Private Equity Firm
March 3, 2020
Source: Nasdaq
U.S.-based private equity firm Clayton, Dubilier & Rice said on Tuesday it will buy British advertising and marketing company Huntsworth HNTS.L for about 400 million pounds ($511 million), sending its shares surging 50%.Shareholders of Huntsworth, which provides marketing and medical communications services to pharmaceutical companies, will receive 108 pence per share in cash, according to a statement on Tuesday. The price represents a 50% premium to the stock's Monday closing price.
Shares of the company soared 50% in morning trade - touching the 108 pence mark as of 0807 GMT.
Clayton, Dubilier & Rice (CD&R) said it believes that Huntsworth's underlying markets, the U.S. and Europe, were attractive and were underpinned by stable pharma-related trends.
Huntsworth, which owns public relations firm Citigate, in a separate statement on Tuesday reported strong results for the year, with pretax profit surging 27% as its communications division returned to growth.
"Organic revenue growth accelerated over the course of the year and the acquisitions of Kyne in Marketing and Creativ-Ceutical in Medical both contributed to 2019 performance," said Paul Taaffe, chief executive of Huntsworth.
The private equity firm said it intends to assist Huntsworth with future acquisitions.
"Our vision for Huntsworth is shared with management, who have demonstrated an ability to drive organic growth and execute accretive add-on acquisitions," said Liam Fitzgerald, adviser to CD&R funds.
Huntsworth's directors were advised by Rothschild & Co as to the financial terms of the deal, while BofA Securities were among financial advisers to CD&R.
