Batesville-based Hillenbrand Inc. announced Monday morning that it has agreed to purchase K-Tron International Inc., a manufacturer of industrial conveyor and control systems in New Jersey.
Hillenbrand, the holding company for Batesville Casket Co., said it will acquire K-Tron for about $435 million, including roughly $45 million in K-Tron debt and cash on hand. The final purchase price, however, will be calculated based on K-Tron’s financials on the day the sale closes.
The transaction is expected to be completed by the end of March, at which time K-Tron will operate as a wholly owned subsidiary of Hillenbrand.
The purchase price translates to $150 per share in cash, which represents a 32.1-percent premium over the Jan. 8 closing price of K-Tron’s stock, and a 38.6-percent premium over the 20-day average closing stock price, Hillenbrand said.
Directors of both companies have unanimously approved the agreement, which still needs to be voted upon by shareholders.
“We are delighted that K-Tron will be joining the Hillenbrand family of companies,” Hillenbrand CEO Kenneth A. Camp said in a prepared statement. “Although K-Tron’s products differ from ours, we are both manufacturing companies that share similar processes and core operational values.”
Hillenbrand expects to use cash on hand and proceeds from debt financing to fund the acquisition.
Southfield, Mich.-based P&M Corporate Finance LLC is serving as Hillenbrand’s financial adviser. New York-based Goldman Sachs & Co. is K-Tron’s adviser.