ADT (ADT) to be Acquired by Apollo Funds in $15B Deal
Shares of The ADT Corporation (ADT) were up +14.13 or +52.59 percent to $41.00 per share in Tuesday’s premarket after news broke early this morning that the company would be taken over by Apollo Global Management (APO) for $42 per share. ADT Corp. stock closed at $26.87 per share, up +0.50 or +1.90 percent in Friday’s regular trading session.
Boca Raton, Florida based ADT Corp. was founded as American District Telegraph in 1874.
ADT Corp. will be combined with a previous Apollo acquisition, Protection 1, a full service home and business security firm. The combined company will be headed by Tim Whall, Chief Executive of Protection 1.
The transaction will be financed by $1.555B in new first lien term loans, the issuance of $750 million of preferred stock in Koch Equity Development LLC, Koch Industries investment and acquisition arm and $3.140 billion in new second tier loans. Concurrent with the closing of the transaction, Protection 1 will enter into a new $255 million first lien revolving facility which will increase the company’s combined senior secured revolving facility to $350 million.
In addition, Protection 1 intends to redeem all of ADT’s 2.25 percent outstanding unsecured notes due in July of 2017 and the company’s senior unsecured 4.125 percent notes due in April of 2019 along with all outstanding borrowings in its revolving credit facilities. Protection 1 will also guarantee ADT’s remaining $3.75 billion of total senior unsecured notes.
Naren Gursahaney, President and Chief Executive Officer of ADT said in the company’s press release that, “This transaction represents a highly attractive premium for ADT's shareholders. We're proud to have strengthened the quality of our customer base, improved service and retention, and extended our leadership in innovative solutions such as our ADT Pulse platform and our new Security-as-a-Service offering, ADT Canopy. By combining Protection 1 with ADT, we will be better positioned to expand the breadth and depth of the services we offer to our customers throughout the United States and Canada.”
ADT’s Board of Directors unanimously approved the transaction, which is expected to be concluded by June of this year. The transaction is still subject to ADT stockholder approval and the applicable antitrust waiting period in the United States and Canada.
The deal includes a “go shop” period that will allow ADT and its Board to actively solicit negotiations with other parties that may offer alternative proposals during a period of 40 days following the execution of the definitive agreement.
News about ADT
ADT Stock Surges on Earnings Beat
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The ADT Corporation Announces Quarterly Dividend
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