Nortek, Inc., the parent company of Nortek Security & Control LLC, announced on Wednesday that it has entered into an agreement to be acquired by UK-based Melrose Industries PLC for approximately $2.8 billion.
Under the terms of the merger agreement, which was unanimously approved by Nortek’s and Melrose’s boards of directors, Nortek will become a wholly owned subsidiary of Melrose following the deal’s completion.
In addition, the merger agreement provides for a window shop period through August 6, 2016, during which, subject to certain procedures outlined in the agreement, Nortek may enter into discussions and negotiations with third parties that submit an unsolicited proposal to acquire the company. Should Nortek agree to accept a superior proposal prior to 11:59 p.m. ET on August 6, 2016, Nortek would have to pay Melrose a termination fee equal to $50 million.
"We are very pleased to have reached the proposed agreement with Melrose Industries, which represents a significant premium for our shareholders," said Nortek's President and Chief Executive Officer Michael J. Clarke. "We believe this partnership with Melrose will enhance Nortek's ability to further leverage its industry-leading brands and market positions to continue driving profitable growth. We believe this transaction will be a positive for our employees and customers alike."
"We have watched and admired Nortek's progress and we are convinced we can steer this fine business to achieve its full potential," said Melrose's Chairman Christopher Miller. "We see a company full of hard-working, dedicated people who are really good at what they do. We can harness those strengths by meaningful long term investment and a vision based on our own experience in similar and relevant markets down the years. Melrose has been a highly successful custodian and builder of US businesses and we are confident that we can bring that expertise to build Nortek for the long term."
