By Tess Stynes
A Brookfield Asset Management Inc. affiliate agreed to acquire
GrafTech International Ltd. in a deal that values the maker of
carbon and graphite products at an estimated $692.8 million.
The asset manager is planning to acquire GrafTech's stock in a
tender offer of $5.05 a share, a 2% premium over Friday's closing
price.
GrafTech shares rose 3% to $5.10 in recent premarket
trading.
The planned deal was unanimously approved by GrafTech's board
and follows a preliminary accord unveiled late last month. During
April, GrafTech said it had reached a preliminary pact with
Brookfield under which Brookfield would make a $150 million
preferred equity investment in GrafTech, along with a preliminary
deal to acquire the company.
Holders of roughly 11% of GrafTech shares, including director
Nathan Milikowsky have agreed to tender their shares to the
offer.
GrafTech has faced challenging global markets in both its
industrial materials and engineered solutions segments.
During the first quarter "graphite electrode demand continued to
soften as global electric arc furnace steel production weakened,"
GrafTech Chief Executive Joel Hawthorne had stated in a news
release last month. "Lower end-market demand in certain steel
consuming sectors, continued high Chinese steel exports and other
market dynamics led to lower [electric arc furnace] customer
utilization rates, particularly in North America."
Such factors were expected to pose challenges for GrafTech and
the broader industry for the rest of this year, he added at the
time.
Write to Tess Stynes at tess.stynes@wsj.com
Access Investor Kit for Brookfield Asset Management, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=CA1125851040
Access Investor Kit for GrafTech International Ltd.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US3843131026
Subscribe to WSJ: http://online.wsj.com?mod=djnwires