mlkrborn
13 years ago
SFN to be acquired @$14 a share!
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By A. Ananthalakshmi
BANGALORE, July 21 | Thu Jul 21, 2011 11:46am EDT
BANGALORE, July 21 (Reuters) - Shares of U.S. staffing companies rose on Thursday, boosted by Randstad's $710 million offer to buy SFN Group Inc and strong earnings from top recruitment firms.
On Wednesday, Netherlands-based Randstad offered to buy SFN Group Inc amid a weak U.S. job market for $14 a share -- a 52 percent premium.
The acquisition will make Randstad the third biggest human resource services provider in North America behind Switzerland's Adecco SA and Manpower .
SFN's shares jumped 50 percent on the New York Stock Exchange and were trading just below the offer price. Randstad shares rose 5 percent on the Amsterdam exchange.
Other staffing companies Kelly Services Inc , TrueBlue , Kenexa , KForce and Hudson Highland Group were all trading up on Thursday.
Manpower, the world's No. 3 temporary staffing company, reported much higher-than-expected quarterly earnings, helped by the weak U.S. dollar and strong demand in emerging markets, France and Italy. It's shares rose 5 percent.
Robert Half International Inc rose 15 percent after strong earnings.
Staffing shares have fallen sharply in the last three months hit by a soft job market.
U.S. employment growth ground to a halt in June, with employers hiring the fewest number of workers in nine months, dousing hopes the economy would regain momentum in the second half of the year. The unemployment rate climbed to a six-month high of 9.2 percent.
YEARS OF COURTSHIP
The SFN acquisition was prompted by a Randstad's strong performance in North America and a solid balance sheet, the company said.
"We have been courting SFN for quite a while -- goes back many, many years... but there was always something in between -- we finally intend to get married now," said an executive.
Randstad, the second largest HR services provider in the world, will double its presence in the United States after the deal. In North America, the combined company will have revenue of $4.6 billion.
"Randstad and SFN have a similar service offering in North America and a complementary geographic coverage, which creates a unique strategic fit," KBC Securities analyst Margo Joris said.
Fort Lauderdale, Florida-based SFN traces its roots to Chicago in 1946 when it helped firms find staff to load and unload freight shipments. It now operates under several brands such as Spherion, Technisource, Tatum, Mergis and SourceRight Solutions. (Reporting by A. Ananthalakshmi in Bangalore; Editing by Saumyadeb Chakrabarty) (ananthalakshmi.as@thomsonreuters.com; within US +1 646 223 8780; outside U.S +91 80 4135 5800; Reuters Messaging: ananthalakshmi.as.reuters.com@reuters.net)
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