RHI makes deal to merge with brazilian Magnesite

Frankfurt-the Austrian thermal materials group, RHI Refractories announced on Wednesday a deal to combine its activities with Magnesita through the purchase of a participation of at least 46% and no more than 50% plus one share of the brazilian manufacturer of refractory products.
The acquisition of slice of 46% will be paid in cash for an amount of EUR 118,000,000. The transaction provides for the issuance of 4,600,000 of new shares to be issued by the combined company, RHI magnesite.
In addition, a subsequent mandatory public offer will be launched with the issuance of a maximum of 5,400,000 shares of RHI Magnesite, which will raise the total number of new shares issued by the company for up to 10,000,000.
The offer will include an alternative cash only which provides for EUR 8.19 per share value of magnesite.
The operation must be completed in 2017 and the new company will be headquartered in the Netherlands with shares listed in London. The deal was arranged by RHI with the controlling shareholders of Magnesite, GP Investments and the Rhône.
The two companies will remain completely separate and independent until the completion of the deal.
As a result of the transaction, the GP, largest shareholder of Magnesite with 37,7%, will become relevant shareholder of the new combined company and will have the presence on the Board of Directors informed RHI.