STOCKHOLM, Nov 11 (Reuters) - Sweden’s Momentum Group on Monday launched an offer to buy tools and work wear supplier Swedol for 46.50 crowns ($4.79) per share, saying a merger with its Tools business would boost margins, sales and profits.
Momentum Group, a reseller of industrial consumables and components, said Swedol’s shareholders could choose between a cash offer or swap each Swedol share for 0.40 B-shares in Momentum.
Swedol’s independent bid committee unanimously recommended the cash offer.
Momentum Group said in a statement that the cash offer represents a premium of 39.0% compared to Swedol’s closing price on Friday, while the share consideration represents a premium of 25.1% based on the closing prices of both companies’ shares.
Swedol’s largest shareholder, Nordstjernan AB, with around 67% of shares and 72% percent of the votes, said it would accept the share consideration.
Momentum Group said Swedol’s operations would be part of its business area Tools & Consumables, which would have revenues of around 8.5 billion crowns and an operating margin (EBITA) of roughly 6.5%.
It added that the proposed transaction had the potential to boost the businesses’ operating margin to approximately 10 percent. ($1 = 9.7061 Swedish crowns) (Reporting by Helena Soderpalm; Editing by Simon Johnson)