JBT Corporation Announces the Execution of a Definitive Transaction Agreement with Marel hf., Representing a Significant Milestone Towards the Anticipated Launch of a Voluntary Takeover Offer for All Marel Shares
- JBT and Marel have executed a definitive transaction agreement for a voluntary takeover offer.
- The offer includes options for shareholders to receive cash, JBT common stock, or a mix, valuing Marel at €950 million.
- The combined company will be named JBT Marel , with Brian Deck as CEO.
- Eyrir Invest hf. has committed to accept the offer for all of its shares in Marel.
- JBT plans to use existing cash and bridge financing for the acquisition, expecting a pro forma net leverage ratio of less than 3.5x by year-end 2024.
- None.
Insights
The proposed acquisition of Marel by JBT Corporation is a strategic move that can potentially reshape the competitive landscape of the food & beverage technology solutions sector. The combination of JBT's global presence and Marel's innovative processing solutions could result in a company with enhanced capabilities to meet the growing demand for automation and efficiency in food production. The transaction's structure, offering Marel shareholders a mix of cash and stock, is designed to align the interests of both companies' shareholders, potentially leading to a more stable and integrated business operation post-merger.
From a market research perspective, the key factor to watch will be the combined company's ability to realize the projected revenue synergies. The emphasis on keeping a significant Icelandic presence and establishing a European headquarters in Gardabaer suggests a commitment to maintaining Marel's operational strengths while leveraging JBT's global network. This could enhance the combined company's competitive position in the European market, which is critical given the region's stringent food safety and production standards.
Financially, the merger between JBT and Marel appears to be a significant undertaking, with JBT securing a €1.9 billion bridge financing facility to support the transaction. This move indicates confidence in the deal's value creation potential. However, the forecasted pro forma net leverage ratio of less than 3.5x by year-end 2024, with a reduction to below 3.0x by year-end 2025, will be an important metric for stakeholders to monitor. A leverage ratio above industry norms could raise concerns about the combined company's debt burden and its ability to manage financial risks, especially in a volatile market.
Investors should also consider the liquidity implications of the transaction, given that the consideration mix is estimated to be 65 percent stock and 35 percent cash. The ability for Marel shareholders to receive JBT shares listed on the NYSE or Nasdaq Iceland could affect the liquidity and market dynamics for JBT's stock. The irrevocable commitment from Eyrir Invest hf. to accept the offer lends credibility to the offer's attractiveness and could signal to other shareholders the potential benefits of the transaction.
From a legal standpoint, the transaction agreement's emphasis on obtaining necessary regulatory approvals and the commitment to use reasonable best efforts to do so is standard in such cross-border deals. The mutual representations, warranties and covenants are designed to protect both parties' interests and provide a framework for the merger's completion. The governance structure of the combined company, with a balanced Board of Directors from both JBT and Marel, suggests a merger of equals approach, which could facilitate smoother integration and governance post-transaction.
It is also noteworthy that the transaction is subject to the tender of at least 90 percent of Marel's outstanding shares, a common threshold in takeover offers that ensures the acquiring company gains sufficient control. The commitment to preserve Marel's heritage and maintain a significant Icelandic presence may have been key in securing the support of Marel's largest shareholder and could play a role in obtaining regulatory clearance by demonstrating a continued investment in the local economy and workforce.
JBT and Marel are continuing to work expeditiously to finalize and submit a preliminary proxy statement/prospectus on Form S-4 with the
“The execution of this transaction agreement represents a significant milestone in the process to combine JBT and Marel, creating a stronger business that will benefit shareholders, customers, and other stakeholders,” said Brian Deck, JBT’s President and Chief Executive Officer. “The approval of the transaction agreement by the Board of Directors of both companies is the result of highly collaborative work between the JBT and Marel teams. We both completed confirmatory due diligence, which reaffirmed the compelling industrial logic of the combination and the value creation for shareholders. This process has reinforced our confidence in the potential revenue synergies and further value creation opportunity.”
Marel Offer Summary
The economic terms of the offer are consistent with JBT’s prior announcement on January 19, 2024. Subject to a proration feature, Marel shareholders will have the option to elect to receive either all cash, all JBT common stock, or a combination of cash and JBT common stock in respect of each Marel share as outlined below:
-
All cash:
€3.60 in cash - All JBT common stock: 0.0407 JBT shares
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Combination of cash and JBT common stock:
€1.26 in cash and 0.0265 JBT shares
The economic terms above utilize a reference share price of
JBT intends that the combined company will remain listed on the New York Stock Exchange (NYSE) and will submit a secondary listing application to list a portion of JBT’s common stock on Nasdaq Iceland. Marel shareholders will have the ability to elect to receive JBT shares listed either on the NYSE or, upon a successful application by JBT for a listing on Nasdaq Iceland, on Nasdaq Iceland.
Eyrir Invest hf., the largest shareholder in Marel with approximately 25 percent of Marel’s issued and outstanding ordinary shares, has irrevocably undertaken to JBT to accept the offer in respect of all of its shares in Marel.
The Transaction Agreement
The transaction agreement includes comprehensive negotiated terms and conditions, including (i) the obligation to use reasonable best efforts to obtain required regulatory approvals (subject to certain limitations), (ii) cooperation in preparing required offering documents and other matters and (iii) certain mutual representations, warranties, and covenants.
The transaction agreement provides that Brian Deck will serve as Chief Executive Officer (CEO) of the combined company, Arni Sigurdsson will be President of the combined company, and the remainder of the executive leadership positions will be a combination of talent from both companies. The combined company’s Board of Directors will consist of five independent directors from the pre-closing JBT Board of Directors, four independent directors from the pre-closing Marel Board of Directors, and the CEO of the combined company. Alan Feldman will serve as Chairman of the Board of the combined company.
The transaction agreement also includes a commitment to a significant Icelandic presence and to preserving Marel’s heritage, as outlined in JBT’s prior announcement on January 19, 2024. The combined company will be named JBT Marel Corporation and Marel’s current facility in Gardabaer,
Among other closing conditions, JBT’s obligation to consummate the offer is conditioned upon at least 90 percent of Marel’s outstanding shares being tendered into the offer as well as the approval by JBT stockholders of the issuance of JBT stock in connection with the offer.
Acquisition Financing
JBT expects to partially utilize its existing cash on hand as well as a
Upcoming Conference Call Schedule
JBT expects to host a conference call in early May to discuss its first quarter 2024 financial results and the planned offer. Additionally, JBT expects to host a transaction-specific conference call promptly after the offer is launched.
Transaction Advisors
Goldman Sachs Co LLC is acting as JBT’s financial advisor and Kirkland & Ellis LLP and LEX are serving as JBT’s legal counsel. Arion banki hf. is acting as JBT’s lead manager for the Icelandic offer and advising on the Icelandic listing.
About JBT Corporation
JBT Corporation (NYSE: JBT) is a leading global technology solutions provider to high-value segments of the food & beverage industry. JBT designs, produces, and services sophisticated products and systems for a broad range of end markets, generating roughly one-half of its annual revenue from recurring parts, service, rebuilds, and leasing operations. JBT Corporation employs approximately 5,100 people worldwide and operates sales, service, manufacturing, and sourcing operations in more than 25 countries. For more information, please visit www.jbtc.com.
Forward Looking Statements
This release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act), and the Private Securities Litigation Reform Act of 1995 (PSLRA), and such statements are intended to qualify for the protection of the safe harbor provided by the PSLRA. Forward-looking statements are information of a non-historical nature and are subject to risks and uncertainties that are beyond JBT’s ability to control. These forward-looking statements include, among others, statements relating to our business and our results of operations, a potential transaction with Marel and our objectives, strategies, plans, goals and targets. The factors that could cause our actual results to differ materially from expectations include, but are not limited to, the following factors: the occurrence of any event, change or other circumstances that could give rise to the termination or abandonment of the offer; the expected timing and likelihood of completion of the proposed transaction with Marel, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the offer that could reduce anticipated benefits or cause the parties to abandon the transaction; the ability to successfully integrate the businesses of JBT and Marel; the possibility that shareholders of JBT may not approve the issuance of new shares of common stock in the offer; the risk that Marel and/or JBT may not be able to satisfy the conditions to the proposed offer in a timely manner or at all; the risk that the proposed offer and its announcement could have an adverse effect on the ability of JBT and Marel to retain customers and retain and hire key personnel and maintain relationships with their suppliers and customers and on their operating results and businesses generally; the risk that problems may arise in successfully integrating the businesses of Marel and JBT, which may result in the combined company not operating as effectively and efficiently as expected; the risk that the combined company may be unable to achieve cost-cutting synergies or that it may take longer than expected to achieve those synergies; fluctuations in JBT’s financial results; unanticipated delays or accelerations in our sales cycles; deterioration of economic conditions, including impacts from supply chain delays and reduced material or component availability; inflationary pressures, including increases in energy, raw material, freight, and labor costs; disruptions in the political, regulatory, economic and social conditions of the countries in which we conduct business; changes to trade regulation, quotas, duties or tariffs; fluctuations in currency exchange rates; changes in food consumption patterns; impacts of pandemic illnesses, food borne illnesses and diseases to various agricultural products; weather conditions and natural disasters; the impact of climate change and environmental protection initiatives; acts of terrorism or war, including the ongoing conflicts in
No Offer or Solicitation
This release is not intended to and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In particular, this release is not an offer of securities for sale in
Overseas Jurisdictions
This release is for informational purposes only and does not, and shall not, constitute an offer, or any solicitation of any offer, to buy or subscribe for any securities in JBT or Marel, nor a solicitation to offer to purchase or to subscribe for securities of JBT or Marel in any jurisdiction, including in
Copies of this release and formal documentation relating to the offer will not be, and must not be, mailed or otherwise forwarded, distributed or sent in, into or from any jurisdiction where local laws or regulations may result in a significant risk of civil, regulatory or criminal exposure if information concerning the offer is sent or made available to Marel shareholders in that jurisdiction or any jurisdiction where to do so would violate the laws of that jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any such jurisdiction.
Note to
It is important that
Important Additional Information
No offer of JBT securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, or an exemption from registration, and applicable European regulations, including the Icelandic Prospectus Act no. 14/2020 and the Takeover Act. In connection with the offer, JBT is expected to file with the SEC a Registration Statement on Form S-4, which will contain a proxy statement/prospectus in connection with the proposed offer. Additionally, JBT will also file with the FSA for approval a prospectus in accordance with Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 for the shares to be issued in connection with the proposed offer and for the listing and admission to trading on Nasdaq Iceland of JBT securities (the prospectus). JBT also intends to file the offer document with the FSA. SHAREHOLDERS OF JBT AND MAREL ARE URGED TO READ THE PROXY STATEMENT/ PROSPECTUS, THE PROSPECTUS, AND THE OFFER DOCUMENT, AS APPLICABLE, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC OR THE FSA CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. JBT and Marel shareholders will be able to obtain a free copy of the proxy statement/prospectus (when available), as well as other filings containing information about JBT, without charge, at the SEC’s website, www.sec.gov, and on JBT’s website at https://ir.jbtc.com/overview/default.aspx. Following approval by the FSA, you may obtain a free copy of the prospectus on the FSA’s website at www.fme.is and on JBT’s website at www.jbtc.com as well as a free copy of the offer document.
Participants in the Solicitation
JBT and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the holders of the JBT’s common stock in respect of the offer to Marel shareholders. Information about the directors and executive officers of JBT is set forth in the proxy statement for JBT’s 2024 Annual Meeting of Stockholders, which was filed with the SEC on March 28, 2024, and in the other documents filed after the date thereof by JBT with the SEC. Investors may obtain additional information regarding the interests of such participants by reading the proxy statement/prospectus regarding the proposed offer when it becomes available. You may obtain free copies of these documents as described in the preceding paragraph.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240404724311/en/
Investors & Media:
Kedric Meredith
(312) 861-6034
kedric.meredith@jbtc.com
Marlee Spangler
(312) 861-5789
marlee.spangler@jbtc.com
Source: JBT Corporation
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