Ingram Micro Rises After CFIUS Clearance Of Lexmark Deal Encourages

Shares of supply chain service provider Ingram Micro (IM) are advancing after Lexmark (LXK) announced that U.S. regulators cleared the proposed buyout of the company by a Chinese consortium.

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WHAT'S NOTABLE: In a regulatory filing earlier today, Lexmark said that its pending acquisition by a Chinese consortium was approved by the Committee on Foreign Investment, or CFIUS, in the United States. Ingram Micro is also waiting for CFIUS to approve its proposed takeover by a unit of Chinese conglomerate HNA Group. In February, Ingram Micro and Tianjin Tianhai announced that they had entered into a definitive merger agreement under which Tianjin Tianhai will acquire Ingram Micro for $38.90 per share in an all-cash transaction with an equity value of approximately $6.0B. Upon close of the merger, Ingram Micro will become a part of HNA Group, a Hainan-based Fortune Global 500 enterprise group and the largest stockholder of Tianjin Tianhai. On July 21, Ingram Micro announced that, after consultation with CFIUS, the company and Tianjin Tianhai Investment Company elected to submit a joint voluntary notice to the Committee, which they said at the time would be filed in due course. The companies said they continue to expect the transaction to close in the second half of 2016 as previously announced, whereby Ingram Micro will become a part of HNA Group. On August 11, Ingram Micro announced that the end date by which the acquisition of Ingram Micro by Tianjin Tianhai Investment must be completed was extended to November 13 to allow for completion of the CIFUS review.

PRICE ACTION: Shares of Ingram Micro are up 3.56%, or $1.23, to $35.77 in midday trading.
 

Disclosure: None.

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