Collins Industries, Inc. announced that it has entered into a definitive merger agreement with Steel Partners II, L.P., a private investment partnership based in New York. Steel Partners is purchasing Collins in affiliation with American Industrial Partners, an operationally focused private equity firm.
Under the terms of the agreement, Collins shareholders will receive $12.50 in cash for each share of Collins common stock they hold. The total value of the transaction, including assumed debt and expenses, is approximately $110 million.
The Board of Directors of Collins has unanimously approved the merger agreement and is recommending that Collins' shareholders approve the merger.
Donald Lynn Collins, President and Chief Executive Officer, said, "After careful analysis, the Board of Directors has endorsed this transaction as being in the best interests of our shareholders. The price of $12.50 per share represents a premium of 31.6% to Collins' closing share price on September 26, 2006 and a 68.9% premium to the closing share price on June 28, 2006, the day before we announced that we were exploring a possible sale of the Company."
The transaction is expected to be completed in the fourth calendar quarter of 2006. Completion of the transaction is subject to customary closing conditions, including the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and the receipt of shareholder approval. Certain shareholders representing approximately 29.7% of the outstanding shares of Collins common stock have entered into agreements to vote their shares in favor of the merger. Completion of the transaction is not subject to a financing contingency.