Accuride Corp., a supplier of components to the North American and European commercial vehicle industries, has entered into a definitive agreement to be acquired by funds managed by Crestview Partners, a leading New York-based private equity firm, for $2.58 per share in cash. The purchase price represents a premium of 55 percent over Accuride’s closing share price on Sept. 1 and a premium of 66 percent over the 30-day volume weighted average price as of the same date.
Accuride’s board of directors unanimously approved the Crestview transaction and agreed to recommend that Accuride’s shareholders vote to adopt the merger agreement. In addition, investment funds affiliated with Cetus Capital LLC, who collectively hold approximately 17 percent of the outstanding Accuride shares, have entered into a customary voting agreement to support the Crestview transaction.
The merger agreement contains a customary 35 calendar day “go shop” period during which Accuride and its advisers are permitted to solicit alternative transaction proposals. The transaction is subject to customary closing conditions, including Accuride shareholder approval and antitrust approvals in the United States and Mexico, and is expected to close in the fourth quarter of 2016.
After the transaction closes, Accuride will remain an independent global company with continuity of leadership, business units and worldwide operations. It will continue to operate under its current brand name and remain headquartered in Evansville, Indiana, with operations in the United States, Canada, Mexico and Italy. President and CEO Rick Dauch and the members of the Accuride leadership team will continue to lead the business after the transaction closes.
“Accuride is excited to have this opportunity to partner with Crestview, a private equity firm respected for its integrity and expertise in managing assets, and well regarded for enhancing the value of its holdings,” said Dauch. “After the transaction closes, Accuride will operate as a stand-alone business within Crestview’s portfolio of companies. Accuride will serve as a platform for further growth and consolidation in the global wheels and wheel-end sectors as we expand to serve our customers’ needs worldwide. We are confident that under Crestview’s stewardship, Accuride will receive the resources and support needed to realize our vision of becoming the premier supplier of wheel end system solutions to the global commercial vehicle industry.”
“We are thrilled to have the opportunity to partner with Rick Dauch and the rest of Accuride’s terrific management team to help take Accuride to the next level,” said Alex Rose, partner at Crestview and co-head of the firm’s industrials strategy. “This acquisition results in a de-levered Accuride, providing the company with greater flexibility to pursue growth around the world. Crestview has had great success backing strong industrial companies that are embarking upon global expansion strategies and we look forward to helping Accuride’s management team execute on their vision for the company’s future.”
Deutsche Bank is acting as exclusive financial adviser to Accuride, and Latham & Watkins LLP is serving as legal adviser to Accuride. RBC Capital Markets LLC is acting as exclusive financial adviser to Crestview Partners, and Kirkland & Ellis LLP is serving as legal adviser to Crestview Partners.
Also announced today, Accuride has sold its Brillion Iron Works business to Metaldyne Performance Group. Terms of the deal were not disclosed.