ContourGlobal PLC (LSE:GLO), the owner and operator of contracted power generation plants, has agreed to be bought for £1.75bn cash by US private equity giant KKR.
Shareholders have been offered a price of 263.6p per share, which is well above the previous closing price of 193.4p and the average over the past six months of 188.3p, and a level the shares have not seen since the first half of 2018.
After receiving the 4.0128p quarterly dividend announced last week, which is due to be paid on 10 June, the acquisition price will then be reduced by 4p per share.
The deal is intended to be recommended unanimously by the ContourGlobal board.
With KKR also taking on the company’s net debt, which at the end of last year had swollen to US$3.8bn, all in all it will be shelling out for an enterprise value of roughly US$6.14bn.
ContourGlobal chairman Craig Huff said the board “believes that the offer provides an opportunity for all shareholders to crystallise their investment in ContourGlobal at an attractive price”.
KKR partner Vincent Policard added: “We believe that private ownership would enable ContourGlobal to invest in the business at greater scale and with more flexibility, including accelerating investments in energy transition to reach the stated net zero commitments.”
Shares in ContourGlobal were 33.53% higher at 258.25p in morning trade.