JBT Corp., a global technology solutions provider, is confirming that it has submitted a revised and improved proposal to the Board of Directors of Marel hf. to acquire all of the outstanding common stock of Marel for 3.40 euros per Marel share (ISK511 per share based on an ISK / EUR exchange rate of 150.3). The proposal is contingent on a favorable recommendation from the Marel Board of Directors.

This enhanced offer represents a 46% premium to Marel’s unaffected closing share price on Nov. 23, 2023, of ISK350, a 17% premium to Marel’s closing share price on Dec. 13, 2023, of ISK438.50, and is 8% higher than JBT’s prior proposal that was submitted Nov. 24, 2023. The proposed offer implies an enterprise value of approximately 3.4 billion euros for Marel. In addition, as previously communicated, JBT has received an irrevocable undertaking and remains in exclusivity with respect to the shares owned by Eyrir Invest hf., which holds 24.7% of the shares in Marel.

“JBT has long admired Marel, and there is significant strategic, cultural, and operational alignment between the companies. We are confident that the contemplated merger would bring substantial benefits to both companies’ customers, employees, local communities, partners and shareholders,” said Brian Deck, president and CEO of JBT Corp. “Together, our companies would be best positioned to meaningfully help customers create efficient, higher quality end products with a combined focus on sustainable solutions that make better use of the world’s precious food, beverage, water, and energy resources. JBT remains open to further dialogue with the Board of Marel to design a win-win outcome.”

Strategic rationale

The merger would bring together two companies with complementary product portfolios. Customers of both companies would benefit from the enhanced fuller line of processing capabilities and digitally supported aftermarket parts and service enabled by the combined company’s global reach. The combination offers substantial synergies by providing cross-selling and go-to-market potential, cost savings opportunities and further margin enhancement, positioning both JBT and Marel shareholders to benefit from upside potential.

Commitment to Icelandic heritage

The combined company would have a long-term commitment to a significant Icelandic presence and to preserving Marel’s heritage by maintaining a European headquarters in Gardabaer, Iceland, in addition to a corporate headquarters in Chicago. To maximize shareholder trading liquidity, and consistent with Marel’s publicly stated overseas listing objectives, JBT would contemplate the stock exchange listing remain on the NYSE with a secondary listing in Reykjavik. Additionally, JBT is prepared to provide proportional representation for Marel on the combined company’s board of directors.

Flexible consideration package

JBT is prepared to work with the Board of Marel to design a consideration package that it believes would best meet the objectives of Marel shareholders, including offering up to 50% of the consideration in cash and up to 100% of the consideration in the form of combined company shares. Assuming the transaction is structured as a mix of 50% cash and 50% stock, in aggregate, Marel shareholders would hold approximately 29% of the combined company’s shares. Should Marel’s Board find it more attractive to structure the offer as an all-stock combination, Marel shareholders would then own approximately 45% of the combined company’s shares.

“This ownership position would provide substantial value creation opportunity for Marel shareholders to benefit from the ongoing success of the combined company in addition to the immediate liquidity offered by the cash portion of the consideration,” said Deck. “Regardless of which structure is ultimately deemed to be the most suitable, JBT remains firmly committed to maintaining a strong balance sheet and preserving future strategic flexibility.”

Timing

JBT is prepared to proceed in an expeditious manner to complete diligence and reach a favorably recommended offer as soon as practicable. The issuance of a binding offer remains subject to the approval of JBT’s Board of Directors, and there can be no assurance that any formal offer will be made as a result of these considerations. Consistent with JBT’s overall M&A strategy, JBT intends to remain disciplined with respect to pursuit of this transaction.

Goldman Sachs Co LLC is acting as JBT’s financial advisor and LEX and Kirkland & Ellis LLP are serving as legal counsel.

Source: JBT Corp.