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Héroux-Devtek Inc. (TSX: HRX), a prominent international manufacturer of aerospace products and the world's third-largest landing gear manufacturer, has entered into an arrangement agreement with an affiliate of Platinum Equity Advisors, LLC. Under this agreement, Platinum Equity will acquire all issued and outstanding common shares of Héroux-Devtek, excluding shares to be rolled over by senior management, for $32.50 in cash per share. This transaction values Héroux-Devtek at approximately $1.35 billion, subject to customary closing conditions.
Significant Premium for Shareholders
The $32.50 per share offer represents a 28% premium to Héroux-Devtek's closing share price on July 10, 2024, and a 47% premium to the 90-day volume-weighted average trading price on the Toronto Stock Exchange for the period ending July 10, 2024. This substantial premium underscores the value recognized in Héroux-Devtek's robust market position and growth potential.
Strategic Review and Special Committee Involvement
The arrangement agreement results from a strategic review led by a Special Committee of independent directors at Héroux-Devtek. This review explored various alternatives to enhance shareholder value, ultimately leading to the proposed acquisition by Platinum Equity.
Rollover Shareholders' Commitment
Key members of Héroux-Devtek’s senior management, including Executive Chairman Gilles Labbé and President and CEO Martin Brassard, will roll over a portion of their shares into the Purchaser. These shares will be exchanged at the same value offered to other shareholders, demonstrating the management team's commitment to the company’s future under new ownership.
Commitment to Québec
As part of the acquisition, Platinum Equity has pledged to maintain and invest in Héroux-Devtek’s headquarters and operations in Québec. This includes sustaining the company’s manufacturing operations and ensuring that the headquarters continue to oversee the business's overall management functions. These commitments were made in discussions with Caisse de dépôt et placement du Québec (CDPQ), reinforcing the company's longstanding presence and contribution to the Québec economy.
Continued Leadership and International Presence
Despite the change in ownership, Héroux-Devtek will remain a Québec-based, international leader in aerospace manufacturing. The company’s strategic operations and management structure will remain consistent with its current activities, ensuring stability and continuity in its business practices and client relationships.
