Whirlpool boosts bid for Maytag

Whirlpool boosts bid for Maytag
 
Date August 08, 2005
Section(s) Local News
Brief  
 
BENTON HARBOR, Mich. (AP) — Whirlpool Corp. offered to buy fellow appliance maker Maytag Corp. for $1.62 billion in cash and stock today, plus assumed debt, offering a 43 percent premium to a rival bid by investment firm Triton Acquisition Holding Co.

Whirlpool’s offer — which equals $20 per share in cash and stock — increases its tentative bid by $2 per share. The company plans to assume $977 million in debt as part of the deal, for a total transaction of $2.6 billion.

The bid comes a day ahead of a deadline agreed on by the two companies for Whirlpool to make a firm proposal.

Triton has offered $14 per share, or about $1.13 billion. Maytag shareholders are scheduled to vote on that offer at 10:30 a.m. on Aug. 19.

Whirlpool said its bid will expire at 5 p.m. on Aug. 20. The offer includes a commitment to pay a “reverse breakup fee” of $120 million if regulators do not approve the combination, along with $15 million to retain Maytag employees.

Whirlpool, as an inducement for Maytag to give notice to Triton that it plans to terminate the current agreement and cancel the shareholder meeting, said it is willing to pay the $40 million break-up fee included in the Triton merger plan

The company said it will pay 50 percent of the purchase price in cash and the remainder in stock.

Whirlpool, the country’s largest appliance maker, previously had said it was planning to offer around $18 a share, or $1.43 billion.

In a letter to Maytag CEO Ralph Hake and board of directors member Howard Clark, Whirlpool CEO Jeff Fettig said the offer benefits Maytag shareholders.

“We believe we have addressed in every manner the concerns we understood the Maytag board to have had with a potential combination with Whirlpool,” Fettig said. “Most importantly, we are providing a tremendous economic package of benefits to Maytag and its shareholders, and one that we believe would be strongly welcomed and supported by your shareholders.

Maytag shares rose $1.52, or 8.9 percent, to $18.50 in morning trading on the New York Stock Exchange. The stock has traded in a range of $9.21 to $21.39 in the past 52 weeks. Shares of Whirlpool rose $2.78, or 3.5 percent, to $82.49 on the NYSE.

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