• 48°

D.C. firm makes bid for Cooper

[08/01/01] Washington, D.C.-based Danaher Corp. has made a proposal to Cooper Industries for a merger of the two corporations in a stock and cash deal that could be worth between $54 and $58 per share to Cooper stockholders.

Cooper is based in Houston, Texas, and has an operation in Vicksburg, Cooper Lighting. The local operation manufactures a high-intensity discharge lighting and other products for industrial and exterior applications. Cooper’s plant on U.S. 61 South started as a Westinghouse Corp. facility in the 1950s making various fluorescent light fixtures. Over the years, ownership changed to Crouse Hinds and then to Cooper.

At at news conference in Washington Wednesday morning, Danaher officials announced the company had proposed the merger to Cooper’s leadership at a meeting July 21.

The merger would have a total value between $6.5 and $7 billion including assumed debt, based on recent prices for Danaher stock. The deal would represent a premium of 30 percent to 39 percent over Cooper’s closing stock price Monday and 38 to 48 percent over Cooper’s average share price over the last three months.

The merged company would have combined revenues of $8 billion and an operating profit of $1.2 billion.

“This is a compelling transaction for both companies from both an industrial and financial perspective, said H. Lawrence Culp Jr., president and chief executive officer of Danaher. “We believe Cooper shareholders will find our proposal preferable to Cooper’s proposed reincorporation in Bermuda, especially given Danaher’s long history of superior performance relative both to market indices and Cooper’s shares.”

As proposed to Cooper officials, shareholders would receive consideration consisting of 75 percent Danaher stock and 25 percent cash. At the high end of the scale, stockholders would receive $14.50 and 0.7650 share of Danaher stock or $13.50 and 0.7123 share of Danaher stock on the low end.

In a letter to H. John Riley Jr., chairman and chief executive officer of Cooper, Culp said the offer was based on publicly available information on Cooper, but he believed his company’s understanding of Cooper would be confirmed by a due diligence review.

“…Which we believe could be completed in as little as two weeks,” Culp’s letter said.

The offer still has to be approved by Cooper’s board of directors and shareholders and there was no indication in Danaher’s information or in information available to the public from Cooper.